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i HOTEL DEVELOPMENT: ASSESSING THE MARKET _ _ r1)The statistics describe consumer visitation to the area. Examples that may spending patterns: they also reveal be analyzed in a report are: • whether the area is a viable retail • Fairs renter for a defined trading area. Theme Parks ('2)The statistics are shown by types Sports events of spending patterns. Usually, this `� Historical sites includes eating and drinking sales. • Military installation • When reviewing this information you In each instance, the consultant should ,h, tdd consider: indicate the effect of the attraction on the • How a decline in retail sales may ; proposed hotel. (See "Sources of Infor- suggest other economic problems. 14116'''4k: mation.") • How a shift in area retail sales sug- gests that traffic patterns may be • '1 Site and Area Evaluation moving towards or away from the Kirby Payne,this article's author, site of the proposed hotel. is manager of Management Ad- When E.M. Statler, founder of the • I low a specific growth trend in retail visor), Services at Pannell Kerr modern, first-class hotel, was asked to ,ales directly relates to the well-he- Forster's Minneapolis office. lie has name the three most important factors for inv. of the proposed hotel. more than 20 years of experience in a hotel's success, he responded:location. • i low the trend in eating and drink- the hotel industry, including location and location. Statler was not im- ing sales may influence your plan- domestic and overseas projects. plying that there is one ideal location for nine of facilities and services. (See Among R vne's clients: Hilton all lodging facilities, but that each hotel ••c,,urres of information.") Inns, Southern Host Hotels. and must he located to attract the type of i tea Hotels of Mexico. guest for which the hotel was designed. COMMERCIAL AND INDUSTRIAL -- - You will probably tell the consultant the ACTIVITY type, size and on-site facilities you con- To summarize: ensure that the stat is- template. For example: (-,,mn>ercial and industrial enterprises tics for visitors to the project site area • Typical types include: budget hotels venerate lodging and food service busi- are neither overstated nor understated. or motels, motor hotels. suburban ness: therefore, trends in the type. num- Further, expect the consultant to indi- standard motels, luxury properties. her and volume of area companies have rate tourism trends in terms of places of resorts, all-suite properties, con 410 :r direct influence on your potential mar- origin, spending patterns, met hod of vention hotels and conference c'en- get. in evaluating an area's economy, re- transportation, and other categories such ters. rent changes are often noire important as age, sex and income. (See "Sources • Familiar sizes:small, less than 150 than trends that extend over the years. of information.") rooms: medium, 151 to 500 rooms: The data your consultant compiles for large. over 500 rooms. ...,,ii should include information about the TRANSPORTATION • On-site facilities: either both food l absorption of office and industrial space and beverage facilities, or food hut in situations pertinent to the market base. in the section of a Preliminary Market no beverage facilities, or neither Ifere are sonic pertinent questions: Overview on. Market Area Characteris- food nor beverage facilities. • is the commercial and industrial tics, the discussion of transportation is A market demand study for a particular base diversified? sometimes limited to its role as a part of concept tailored to a particular market • is it concentrated in a single indus- the area's economic base. in such a con- segment should nonetheless include an try or a limited number of related text, you should check to see that the fol- investigation of total demand and then be enterprises? lowing have been considered: analyzed by individual market segment. • Does the consultant's report tell • The relationship of any transports- This permits flexibility about concept. you whether the area's major husi- tion trends, such as the number of Choosing an area and site is the first nesses are equally sensitive to the airline passengers or highway in a series of critical decisions that affect ups and downs in the economy? motorists, to the proposed hotel. the eventual success of a hotel. Usually. • How does all this information relate • How any current or planned this choice has been made when a consul- to the proposed hotel's possible oc- changes in airports, freeways, toll tant is asked to give an opinion on enpancy cycle and volume potential? roads, or local access roads will af- whether the site is suitable for the type (Secy "Sources of information.") feet the proposed hotel. and class of property contemplated and Transportation is also discussed in sec- designed to serve one or several market TOURISM tions in this article on Project Site and segments. Area Evaluation and in a future article Consequently, you — the user of a re- Not all definitions of tourism are prac- (iii)under Demand Analysis and Recon- port— should expect to find in the "Pmj- tical in the context of the hospitality in- mended Facilities and Services. (See ect Site and Area Evaluation" section a dnstrv. Most people define a tourist as "Sources of information.") detailed analysis of factors affecting the a vacationer. Re sure that your consul- desirability and convenience of the prop- rant, in a market overview, uses sources AREA ATTRACTIONS erty for the expected demand. that define a tourist as a visitor to the area for business as well as personal rea- Attractions may he included in a Prelim- ACCESSIBILITY ,:ons. The consultant should also know nary Market Overview report if they h,iw length of stay relates to the definition serve as a major economic base of the The report should show the location of of a tourist. community and are a primary reason for the site on a map, describe the site's 2 I 1.f l)GiNG/NOVEMBER 1987