There are a lot of great hotel third-party managers in the business today. Some are giant, turnkey operators that encourage owners to set it and forget it. Others have just a few hotels, which could mean that your hotel will be a big fish in their small pond and receive lots of attention. And, there are plenty in the middle that offer the advantages of scale without losing the personal touch. All of them have experience, and each of them will likely say they “think like owners.”
Once you’ve decided it’s time for a change, ask your colleagues for recommendations, gather up your short list and discuss these topics with your candidates to be sure you’re getting the best third-party manager for your hotel and your particular investment style.
It’s a given that the best companies have experience, but look beyond the executives’ bios and ask for case studies that are relevant to the hotel in question.
Turnaround success stories. Has the company ever encountered a situation like you’re presenting? Can they share examples of what they did and what the results were?
Market experience. Every city, every submarket is different. If they have no experience in your city, what have they done in similar markets? Evaluate the response not just based on size, suburban vs. urban, downtown or airport, but also look at the business environment. For example, does the candidate have experience working with tourism partners in a resort town? How about governmental agencies involved in airports or convention centers?
Brand or segment experience. Every brand has different systems, procedures, resources, etc. Choose a company with experience in at least the brand family, if not the exact brand. If you’re thinking about re-branding, it is even more important that the two are aligned. Does the new third-party manager have experience negotiating a rebranding?
What level of corporate support can you expect, particularly when it comes to revenue generation? Will there be a strong marketing, sales, revenue management team guiding your hotel? Who’s on that team and what is their experience?
Access & Transparency
Aside from the general manager, who will be your day-to-day contact? Are you comfortable working with the Area Director of Select Service Brands, or would you prefer to have a direct and open line to the president?
Does the company welcome your input, and offer real-time access to the books? If not, why not?
Effective Business Systems
Real time reporting is a critical tool for the collaborative owner, but providing that information cannot consume hours of the GM’s time each day. The best management companies know that a spreadsheet is not the only measurement of a successful operation, so be sure to ask what ‘real time’ means for the prospect’s system and if it will leave the GM with sufficient time for guests and associates.
There’s no substitute for experience, but be sure your new management company also has two feet planted firmly in the present and both eyes focused clearly on your future success.
-Gerry Chase, President and COO