Normally when a new hotel breaks ground it creates panic in the competitive set and puts in motion a ticking "time bomb" for the competitors. With everything else being constant, if the only difference between the new build and the competition is the condition of the existing property, then investing capital expenditures into that property while the new build is under construction can negate much of the downfall when the new build opens.
Also, if the competitive set is in disrepair and the market is looking for a renovated product and can support that increase in rate, then being the first mover in the market and getting a head start on your capital improvements can provide significant gains in demand and rate. Would you agree?
No comments:
Post a Comment