GCC Hotel Development Cost Trends

Hotel Development Cost

GCC Hotel Development Cost Trends

With the exception of Budget Midscale Hotels which focus on efficient flexible design, development cost per key for all other hotel classes have increased between 10%-20% since 2013, resulting in lower project returns. We consider that further reduction in development costs “HVS 2018 Recommendations” is achievable through increasing efficiency per key, design flexibility, and alignment between the intended positioning/achievable average rate and project investment.

Serviced Apartment Development Cost

GCC Hotel Development Cost Trends

    Development cost per key for Midscale Serviced Apartments in the GCC dropped by approximately 5% since 2013, and increased significantly for Upscale/Five Star Serviced Apartments during the same period, resulting in lower project returns. We consider that further reduction in development costs “HVS 2018 Recommendations” is crucial in order to achieve an alignment between the target market/achievable average rate and project investment.

    Article source: https://www.hospitalitynet.org/performance/4090272.html

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Translate This Page ยป