Any investor, before opening a hotel, evaluates many factors, and, first of all, the budget. The cost of building a room varies depending on the location of the future hotel and its level. For example, in Europe, it will cost more to build a hotel than in Ukraine, and in Kiev it is more expensive than in Odessa.
Initially, you need to estimate the cost of buying a land, connecting engineering and processing all documents. The price will depend on the condition of the building (whether it is necessary to build it, or reconstruction/renovation is required), its size and the size of the plot.
In general, the price of construction of a hotel room in Ukraine can be distributed as follows:
- 3-star – $20 000-$50 000;
- 4-star – $50 000-$150 000;
- 5-star – более $150 000.
However, what is included in this price? You can conditionally allocate the budget to the following stages:
1. Concept formation and project development
The development of the project concept determines the most cost-effective format of the future hotel, the amount of investment, the payback period and the feasibility of investing in general. The concept should be developed by companies that are ready to implement it and are responsible for the result, that is, the payback of the object. As a rule, such management development companies have business analysts, marketing specialists and architects who work together on the concept.
These documents in total can cost no more than 1-2% of the hotel price or from $10,000 to $100,000+.
The project development stage includes: the pre-project documentation stage, the draft design, as well as the "P" and "R" stages. Its cost varies, depending on the level of the hotel and the experience of the contractor, and ranges from $10 to $200/m2 or up to 3% of the project cost.
As a rule, the management company forms a design specification with its own requirements, which forms the basis for working with architects.
More detailed information on: https://ribashotelsgroup.ua/en/hotel-engineering/
2. Building construction
The construction of the building, from the experience of Ribas Hotels Group, is 30% of the cost of the object. The choice of a design solution depends on the location, number of floors and concept. As a rule, this is a reinforced concrete frame. Beach hotels are increasingly using lightweight structures (for example, structurally insulated panels), and timber in mountainous areas. In general, the construction of the hotel frame with exterior walls, glazing, roof and main engineering is 300-400 euro/m2, with the facade and land work- 450-600 euro/m2.
The use of lightweight structures reduces the cost of construction by a maximum of 20%, but carries certain risks and disadvantages (restrictions on the number of floors, fire regulations, etc.).
Depending on the level of the hotel, the cost of engineering may increase by 2-3 times (in hotels of 4-5 stars are being used central air conditioning, recuperation, dispatching, etc.).
More detailed information on: https://ribashotelsgroup.ua/en/hotel-building/
3. Repairs and equipment
On average, the cost of finishing a room in a three-star hotel ranges from $400 to $2000 / m2. At this stage, it is important to choose the furniture and decoration according to the classification of hotels and the planned room price.
The mistake that many owners make at this stage is the use of materials for residential premises, and not for commercial ones. The latter are more wear-resistant and focus on functionality rather than appearance.
A hotel room is a product that is created taking into account the fact that it must last at least 10 years in intensive operation. It should be easily repaired and not become obsolete for the same 10 years until the next renovation.
The architects and the management company must be involved in the process of repair work and completion, as part of the author's supervision. Architects make sure that the design solutions correspond to the implemented ones, and the management company forms the terms of reference and controls the project during the construction process in the event that it is necessary to replace some materials with others due to the rise in price or their removal from production.
From our experience, the effective work of a team of managers and architects can reduce the budget by 20-30% and help to avoid design and construction errors.
4. Pre-launch and launch of the hotel
At least six months before the start of the front desk, the hotel's advertising campaign starts. In two or three months, the recruitment, training and certification of staff will begin. The business processes and operating standards of the hotel will also be adapted if it belongs to a certain network that has them. If the hotel is managed by the owner himself, he describes the standards and business processes with the top management team.
The purpose of the pre-launch of the object is to fill it in from the first day of the hotel's operation and to prevent mistakes by the staff. Chain hotels, as a rule, start cleaning and commissioning longside the exit of builders from the hotel. All employees of the hotel, who are hired and trained in advance, participate in the processes of its preparation for work. From the first days of opening, the hotel and restaurant bring income and profit. This is important both for the economic efficiency of the enterprise and for the team spirit in general.
More details at the link about investments in hotel real estate.
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