UAE hotels can increase value by 22% through room, F&B and energy initiatives

Knight Frank's hospitality report suggests outsourcing F&B operations and investing in modern equipment
UAE hotel operators can increase their bottom line by as much as 22 percent by undertaking a number of room, F&B or energy saving initiatives that will increase revenues and decreasing expenses, according to a new report.
By Bernd Debusmann Jr
Thu 05 Oct 2017 09:53 AM

UAE hotel operators can increase their bottom line by as much as 22 percent by undertaking a number of room, F&B or energy saving initiatives that will increase revenues and decreasing expenses, according to a new report. 

Property consultancy Knight Frank's hospitality report, entitled ‘Driving Hotel Value’, found that hotels can increase room revenue by 6.5 percent a year by managing their relationships with online travel agencies and by offering incentives, such as complementary upgrades or extra amenities, to customers who book directly through the hotel’s website rather than through a third party.

Additionally, keeping room rates constant during low periods, but packaging them with ancillary services (such as spa experiences, breakfast and set dinner menus) can increase total room revenue by 3.6 percent a year.

With regards to F&B, the report statistics indicate that outsourcing operations to a third-party has the potential to increase outlet value by 10 percent. According to Knight Frank, third party membership programmes – such as GuavaPass, ClassPort and ClassDrive – can be charged participation fees lead to as much as AED1 million in additional revenue.

Other potentially lucrative initiatives identified in the report include leasing gym spaces – which can lead to as much as AED400,000 in additional annual revenue depending on space – or by offering chauffer services, which can lead to an uplift in revenue of as much as AED500,000.

Notably, the report found that as much as 20 percent of utility expenses can be saved through the use of innovative engineering and modern equipment, such as LED lights and dimming lighting controls, energy efficient glazing on windows, occupancy sensors or energy management systems that managed from a central point in the hotel.

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