The Bottom Line is More Than ROI

Written by Alex Slors

What does value actually mean in hospitality? Well, it depends who you ask. If it’s an investor or developer, it’s about the property’s worth. If it’s an architect or engineer, it’s the fees they can draw. If it’s a hotel, it’s the rates they charge as well as the value of loyalty. For the team working in the hotel, it’s often bonuses or career prospects. And for the guest, it’s the experience that makes them want to come back because without them, none of us would be here.

That’s why this year’s Festival of Hospitality theme, The Bottom Line, is so important. Throughout 2025, they’re digging into how value is created in hospitality, how it is measured and understood across the whole lifecycle of a hotel. Because in our industry, value isn’t just about the numbers. It’s about people, perceptions and often a bit of old-fashioned common sense.

Value across the lifecycle

There’s no question ROI is vital when approaching the build or refurbishment and operations of a hotel. But value stretches far beyond a balance sheet. It’s personal and shifts depending on your vantage point.

If you look across the lifecycle of a hotel, value takes different forms at every stage.

Feasibility and investment

This is where value starts, with solid planning. There has to be transparency and input from all professionals involved in the hotel project right from the start. This means allowing for additional time, and likely additional costs, at the beginning but it creates a solid feasibility study that’s realistic and forms the backbone of the project.

The key here though is to keep that plan regularly updated and make sure it doesn’t get left on a shelf. We all know project costs won’t go down and the competitive market will shift so it’s important to stay ahead of it all.

In an ideal world, you’d update your figures quarterly, so if your costs creep up or the local market dips, you can still pivot. I’ve seen luxury hotels open into markets that had materially changed over the two years of construction. That’s a disaster waiting to happen.

Design

Good design isn’t just about a striking lobby. It can create real commercial opportunities, like adding extra keys, or shaping Instagrammable spaces that people want to photograph and share. That’s free PR.

It’s also about smart use of space. A while ago, in one project in Budapest, the general manager had a grand office overlooking the main square. We turned that office into a suite and moved the GM to a more sensible spot to create real, tangible value to the hotel’s bottom line.

Construction and fit-out

Once construction gets underway it is crucial that communication with the project team, the owner and the brand is maintained and that all parties understand their responsibilities. Regular project meetings that include the brand and a pre-opening team at an early stage are so important to maximise value at this stage of the project lifecycle.

The temptation to trim costs at fit-out stage can be huge but can backfire badly. You might save in the short term, then find the hotel feels cold and sterile because someone refused to spend on small decorative touches. I worked on a hotel in Italy where the brand wanted £100,000 for bric-a-brac: books, ornaments, bits to make it feel lived in. The owner refused and the whole hotel was soulless.

Operations and asset management

Once the hotel’s running, value comes down to alignment. That’s why I’m keen on using EBITDA as a common target. It underpins the owner’s hotel valuation, the hotel brand or operator’s fees and the hotel team’s bonuses. It makes sure everyone is working towards the same goal, understands everyone else and they aren’t pulling in different directions.

But value is still about more than numbers.

The Ibis at Geneva Airport is my go-to, because it serves it’s function as a comfortable straightforward stay when I’m travelling on business. It only costs 100 francs a night yet that extra value comes from them remembering my birthday when I checked in one year. Little touches add up.

Or the hotel that puts bookmarks in upside down books on the bookshelf so that when the guest opens it, there’s this card with an inspiring quote on it. The bookmark is a tiny cost but something guests will remember.

Exit or repositioning

When it comes time to sell, you’ve got to look at it through the eyes of the buyer (not the seller). Have your numbers and market studies ready, be clear about where there’s still value to be unlocked. And don’t be desperate! Sometimes it’s better to hold on and do a refurbishment than sell in a rush.

Bringing people together

If I could change how we talk about value in hospitality, it would be to get everyone communicating better and for all parties involved in the hotel lifecycle to truly understand each other.

When there’s no hotel, there’s no one – no investor return, no brand fees, no jobs. We’re all in it together, from the dishwasher to the lender to the designer.

I’ve seen huge cultural missteps, like in a small European town where a Middle Eastern owner set up a private table with separate food at the opening party, right in front of the local mayor. Perfectly normal in Bahrain, catastrophic in Europe. You need people who get those nuances and keep everyone aligned. Perhaps an honest conversation between operations and the owner might have alleviated this particular lapse in judgement.

This year’s Festival of Hospitality is about sparking those conversations. Bringing in the QSs, the lawyers, the developers, the designers, the brands, so everyone has a feel for how the others work.

The hospitality industry is a great one. It’s full of opportunity if we remember to put the hotel first, understand each other’s pressures and keep talking. That’s the real bottom line.