by Vijaylakshmi
The hotel development team is a crucial part of a hotel company’s growth path. They are the people who travel across the country and cherry pick those assets, its owners, cities and locations, which fit their brands values and needs, was the thought with which moderator Beni Agarwal, business consultant, GKHS kicked off his panel on Sustaining business growth in India what are the rewards and challenges, at the first Hotel Conclave by Sourceon June 11, 2024 at Crowne Plaza Gurgaon got things started.”A lot of newer generations are talking about the sustainability angle. How are we going to reduce energy consumption, reduce waste when the hotel becomes operational, as well as conserve water. Those discussions are happening. If you’re looking purely at the development side when the hotels are under construction, we at IHG, have built sustainability measures including energy and resource conservation into our brand standard,” said Nishant Kumar, senior director development, South West Asia, IHG.
Kumar also added that he usually had to deal with multiple generations of others, with the grandfather looking at return on ego, the father on return on investment and the son thinking about sustainability, responsible return on investment and talking about green engagement.
Building a hotel is a long term investment and building on the concept of financial sustainability is extremely important to be determined upfront, said Dhruva Rathore, vice president, development for India and SouthWest Asia, Hyatt International.
“It’s really, really important to project what’s going to happen in the future. Where’s the demand going to come from? What are the new demand generators that are coming up in the vicinity? And then determine what are the market segments that are going to sustain that project for the long term, have that conversation with the owner. And then what brand in a portfolio really fits in, to stitch everything up and make it an investment, which is going to stand the test of time,” Rathore said giving his view on financial sustainability while developing new assets.
Jacob Purackal, senior director- development- India at Hilton began by making a very important point that as business development people they were as a group the first point of contact with owners. They were the gatekeepers for their brands and of the owners’ capital. It was crucial to begin by having an honest and frank discussion and understanding the owner’s philosophy, goals and ambitions for the project, while at the same time not pretending to know more about the location than the owners.
“Conversion projects are relatively easier. It’s about how we adapt that asset to our brand standards. Sustainability aspects of the hotel are things that are now built into brand standards, I remember when I joined Hilton, maybe 12 years ago, most discussions never had an element of sustainability or green initiative. Today, when you look at the generation that’s come in, people do talk about these things. Today things like GRMS systems, bottling plants, and doing away with single use plastics are all built into our brand standards,” Purackal said.
The way a hotel company approaches any deal emanates from the DNA of the organisation, how they approach hoteliering, said Anika Gupta, vice president, development, IHCL.
“While assessing an opportunity from an sustainability point of view, I think a greenfield opportunity is easier to do compared to a conversion because when you see a site, you can do the sun path analysis, you can do the wind flow analysis, together with the owner and the architects. In case of conversion, you have inherited a structure, so you cannot take any structural measures to bring in the sustainability aspect. It can only be brought in through materials that you’re using in house, through MEP measures etc. So, it can only be at 30 to 40 percent of the measures which are institutionalised, which is why you have a certain ratio of these sustainability measures being successful at a portfolio level,” Gupta said.
“While assessing an opportunity from an sustainability point of view, I think a greenfield opportunity is easier to do compared to a conversion because when you see a site, you can do the sun path analysis, you can do the wind flow analysis, together with the owner and the architects. In case of conversion, you have inherited a structure, so you cannot take any structural measures to bring in the sustainability aspect. It can only be brought in through materials that you’re using in house, through MEP measures etc. So, it can only be at 30 to 40 percent of the measures which are institutionalised, which is why you have a certain ratio of these sustainability measures being successful at a portfolio level,” said Balvinder Sahrawat, assistant vice president, development South Asia, India and South Asia, Accor.
The answer to the question of whether sustainability was expensive was both a no and a yes, said Davashish Srivastava, senior director development, Radisson Hotels.
“Sustainability measures have still not turned into a norm and because of that there are not enough volumes to make it cost effective—but yes in the long term it is cost effective. There are several of our hotels which have actually taken initiatives, which have given great return on investments. When it comes to sustainability, we approach the subject in three stages—green buildings, green energy, and green operations,” Srivastava said adding, “Our job as business developers is to start educating owners and start messaging about sustainability early on, so that when the technical services team comes into the picture, they have been groomed enough to be able to adapt to any suggestion which comes from the technical team towards building green.”
