Outline Section 3 - Hotel Administration 255 Hospitality...

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Unformatted text preview: Hotel Administration 255 Hospitality Development and Planning ONLINE SECTION 3 – PROGRAMMATIC CALCULATIONS LEARNING GOALS: After completing this online section, you should: 1. 2. Be able to estimate the gross square footage of most kinds of lodging properties. Recognize how programmed values change to accommodate different development conditions. What’s a Program? Early in the development process, the development team needs to work out the building program, which is a detailed outline of what the building needs to include to meet market and financial goals. The program is a document that consists of two parts: the space program, and the functional or descriptive program. As the project progresses, the program becomes more detailed and more refined, and eventually serves as a template for the design team as the spaces are planned and detailed. The space program is a listing of all the physical spaces needed in the building, how large they need to be, and how many there are of different types. While a lot of the detailed space programming happens later in the development process, a general idea of the hotel’s total square footage, number and mix of rooms (or keys, as the industry calls them), and amount of function space needs to be worked out early on so that the project’s construction budget can be estimated, an adequately sized site can be located, and the financial projections for the project can be assembled to establish whether the development is feasible. Of course, these numbers will all change slightly as the project moves forward (or in some cases, change a lot!), so recognize that the program is a living document. The functional or descriptive program outlines how the various parts of the hotel will operate in order to give the designers enough information to create the necessary environments. Much of the information in the functional program comes from the hotel operating company, and so this portion of the program document isn’t really put together until an operator is on board with the project. But the early space program numbers are assembled by the architect with input from the developer during the development planning phases so they can be tested during feasibility. How Big Should a Hotel Be? Well, it depends! Essentially, the drivers of hotel size are: ♣ Market demand: is there a need for rooms in a given segment or of a particular category in a market? Is there latent demand for rooms during some or all periods? ♣ Site limitations: how much land is available, and what are the limitations placed on that land by local zoning? ♣ Financial goals: how much does a project have to generate in order to meet the developer’s (and investors’) goals? Pretty early on, a developer can establish a rough number of rooms (keys) that would be necessary to meet market and financial needs. That number of rooms, along with the type of hotel being envisioned, can then be used to estimate total square footage and how the building will be broken down into guestroom areas and other spaces. The First Step: Working Out Guestroom Area The basic formula for determining guestroom area is: Net area of a typical guestroom module x number of modules x a gross factor Or, as we’ll express it in this course: NGA x # keys (or bays, if that data is available) x GF = GGA Recall from lecture that NGA is the square footage of a typical guestroom in a given hotel. Typical guestroom size varies from property to property, but generally can be estimated based on the category of hotel being created. Typical Values Budget Limited Service Mid Scale Upscale Luxury NGA per guestroom bay 250 NSF 300 NSF 315 NSF 350 NSF 450 NSF Gross factor 1.15 1.38 1.40 1.43 1.45 Early in the development process, the team is likely to only have a rough idea of number of keys necessary, so you’ll see announcements like “XYZ Corp. proposes a 500-room Hyatt hotel for the lakeshore”. But even from this simple information, an estimate of square footage can be generated. Let’s see how the formula applies: A Hyatt hotel is typically an upscale or four-star property, so it’s reasonable to assume that each guestroom will be about 350 net square feet (NSF). (Of course, the eventual hotel will have some rooms that will be suites and therefore larger than 350 NSF, but for now, let’s use this simple projection method.) By looking at the chart above, we can see that upscale hotels usually have another 43% or so of space on the guestroom floor allocated to things other than the guestrooms themselves, including: ♣ Wall thicknesses ♣ Columns and other vertical structure ♣ Hallways ♣ ♣ ♣ ♣ ♣ ♣ Elevators Stairs Linen or maid’s closets Electrical closets Mechanical chases Vending areas All these non-guestroom elements need to be on the guestroom floors to allow the hotel to stand up and to function, so they need to be accounted for when calculating total square footage. Therefore we apply a gross factor to the size of a typical room to get gross guestroom area. For our Hyatt example, that gross factor is about 1.43. So here’s how much guestroom area space this proposed lakeshore hotel needs: 500 rooms (keys) x 350 NSF x 1.43 gross factor = 250,250 gross square feet (GSF) What About the Rest of the Hotel? Guestroom areas represent the majority of space in just about all hotels, but they aren’t everything that needs to be built. There are necessary public spaces as well as back of house areas that any hotel requires. For a simple hotel like a Motel 6, the public spaces are minimal: a small lobby, perhaps a pool area; and the support spaces are also simple: a front desk supported by a small office area, plus a laundry room and some storage space. But for a large convention hotel like our example, there are multiple public spaces to be considered: a large lobby, restaurants and bars, a ballroom or two, meeting rooms, retail spaces, maybe a day spa. There is also substantial back of house space needed to support all these areas: kitchens, laundry, storage, offices, employee areas, maintenance areas, equipment rooms for engineering systems, etc. These spaces are not part of the guestroom area, but need to be added in to get total square footage for the building. Red flag! What about a space like a fitness center in the guestroom tower? Or a concierge-level lounge? Are these public areas or guestroom areas? Generally, if these spaces are limited to guest-only access, then we usually include them in the guestroom portion of the building. As programs get more detailed and it becomes possible to count the number of guestroom bays needed, we can include these special guest spaces as bays and thus they will get added into the gross guestroom area calculation. Back to calculating space for public areas and support: once we know what kind of hotel the project is proposed to be, we can apply one other rule of thumb to determine what proportion of the hotel is likely to be guestroom areas versus public and support space: Budget Guestroom Area % (GR%) Limited Service Mid Scale Upscale Luxury 85-90% 80-85% 75-80% 70-75% 60-65% The formula, then, for transforming gross guestroom area to total gross hotel area is: Gross guestroom area Percentage of property that is guestroom area = Total gross hotel area Or, in HADM 255 shorthand: GGA GR% = GHA So for our example, we’ve worked out the GGA to be 250,250 GSF. As a Hyatt, it’s an upscale project, so it’s likely that about 70% of the total building will be dedicated to guestroom areas. Here’s the formula applied: 250,250 = .70 357,500 So this 500-room Hyatt project is likely to need somewhere in the ballpark of 357,500 GSF of building. Red flag! To be more accurate, you’ll need to know a bit more about the hotel being proposed. For example, resorts and convention hotels typically have a much higher percentage of public spaces than typical hotels do. Thus for a convention hotel, perhaps only 65% of the total space would be guestroom areas, with the balance made up by the oversized lobby, meeting spaces, multiple food and beverage outlets, and other features of a convention hotel as described in Chapter 5 of your textbook. Note that in your lecture handout, some suggested proportions are given for different hotel types. Your turn! Try this one: How many square feet would be required to build a 150-room Comfort Inn? 150 keys x _____ NSF per key x ______ gross factor = GGA of _________ GGA of ________ GR% of ________ = Your answer: . . . . . . . . . . . . . GSF GHA of ___________ How Does the Space Estimate Change? As mentioned above, this early programmatic estimate is driven by the number of rooms proposed and the type of hotel. This gives the development team a reasonable estimate to go on for feasibility, basic budgeting, and initial site selection. But as the project becomes more refined and operator brand standards come into play, a more detailed and accurate space estimate can be prepared. Let’s go back to our Hyatt example. The combination of market research and Hyatt’s brand standards are likely to provide the development team with a breakdown of the guestroom mix, that might look something like this: Keys King Guestroom Double/Double Guestroom Handicapped Accessible Hospitality Suite Conference Suite VIP Suite Presidential Suite Concierge Club Total Total Bays Bays NSF per Bay Total Net SF 140 1 140 350 49,000 324 1 324 350 113,400 16 1 16 350 5,600 12 1.5 18 525 6,300 3 2 6 700 2,100 4 3 12 1,050 4,200 1 5 5 1,750 1,750 0 4 4 1,400 1,400 500 18.5 525 183,750 Once this information is available, a more detailed projection can be made: 183,750 NSF x 1.43 gross factor = 262,763 GSF for GGA You can see from this that if you have an accurate bay count (remember that a “bay” is just another term for a typical guestroom module) and an idea of bay size for the brand or type of hotel being developed, you can use the same formula as we did before, with one minor modification: NGA x # bays x GF = GGA For this example: 350 NSF x 525 x 1.43 = 262,763 GSF The market research and feasibility study might also indicate that a convention hotel is a good choice for this site and market, and therefore: 262,763 65% = 404,250 Thus the GHA for the hotel now that we have more information is 404,250 GSF. Additional planning detail about the public and back of house spaces (will this hotel do its own laundry or outsource? How many restaurants and bars are proposed?) will also allow us to adjust the total sqaure footage value, getting more and more accurate results. Of course, the most accurate estimate of square footage comes once the design process is complete, and the architects have prepared detailed drawings of the building that can be measured. The important takeaway message here is that while we can get some good preliminary estimates of necessary square footage using these formulas, the final size of the hotel is dictated by a wide range of factors and cannot be determined with certainty until the design phase of the project is complete. Therefore, the wise developer knows that the preliminary budget estimate might be somewhat inaccurate if only based on these thumbrule calculation, and for this reason usually adds a 10-15% contingency factor to early budgets. Ready to test yourself? Try the questions at Assignments◊Self-Tests◊Programmatic Calculations Self-Test. ...
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