An economy hotel will always make money: Wolfgang Gold [Video]
If the economy is good, more people will travel. If the economy is bad, people will trade down. So, investing in a hotel is always a good idea, says veteran hotel development consultant Wolfgang Gold
Wolfgang Gold has a 27-year career in international hospitality and has done it all — from direct customer interaction roles to management, business growth, sales and marketing development, accounts, quality evaluation and portfolio expansion.
With extensive experience in managing local and European corporate and public sector blue chip accounts, Gold also works with owners, directors and operators of hotels.
On the sidelines of TOPHOTELWORLDTOUR London 2019, Xcentric Hotels’ veteran hotel development consultant spoke to TOPHOTELNEWS on the challenges facing the industry, why investing in budget hotels is a good idea in all economic climates, and how to invest amid Brexit uncertainty.
Biggest challenges in hotel development today
Gold: The biggest challenge at the moment is finding the right sites and finding right locations. You do find some fantastic sites, but they are, in my eyes, overpriced. The prices go up and up. So does the price of construction.
On other sites in, for example, in Europe, the biggest challenge we’re facing is staffing. You don’t really get quality staff. Actually, there’s hardly any staff available and that’s a big big challenge in the hospitality industry and that will be in the UK as well if whatever happens happens in the end of March.
What’s the best strategy to invest amid Brexit uncertainty?
Gold: That’s the million-dollar question. I think it’s just carry on as normal. You can’t just let your life and your investments be defined by one event. If you’re looking to buy a hotel, invest in a hotel, you’re looking at the long term: 20 – 30 years. So much can happen. If you just look back 10 years ago, there was a big recession. Nobody forecast that, but everybody survived as well and then continued on. So I think you just have to take the plunge, invest in it.
Yes, some people say wait for a couple of months, the prices might go down. They might not, like I said, nobody knows exactly what happens. I would say just keep on investing. Hotels will always be needed wherever you are and they will continue to grow as well, as long as you invest in the right type of hotel.
What is the “right type” of hotel in which to invest?
Gold: I think for me, the right type of hotel is a budget hotel. An economy hotel will always make money. If the economy is good, more people will travel, if the economy is bad, they will trade down. So all the people who are staying 3, 4-star hotels will then convert to budget hotels.
And the other sector is luxury hotels. There will always be rich people so they will continue traveling and they will continue using luxury hotels. Might not be as much as in the past, but I think those two segments will survive. It’s the middle market that will struggle and that’s where the hotels will suffer the most.
Advice regarding top level customer service in hotels
Gold: Look after the guest, be friendly and listen to the guest — what he says and what he needs as well. Agree with the guest; doesn’t matter if he’s wrong. Discuss internally what went wrong and why it went wrong, but in front of the guest just resolve it even if you believe the guest is wrong. In the guest’s eyes, he is right so make it right.
Thoughts on the TOPHOTELWORLDTOUR
Gold: I think TOPHOTELWORLDTOUR is completely different to any other conference. And I’ve been there 3 or 4 times. It’s always a great experience.
You experience always different hotels, which is fantastic, but also the networking side. In a way, you’re forced to network, which is good thing because you’re moving around from table to table and you get to speak, to more or less, everybody who attends.
In other conferences, you don’t get the chance to do that. It’s good topics that are discussed as well. I do like to see the different hotel projects that are being presented as well. You see things, you think wow, this is a fantastic hotel. I could never afford to stay there, but it’s great. And it just looks great and the people you meet, different walks of life as well as the different types within the industry. And people who are not necessarily attending other conferences as well.
Your personal highlight of the TOPHOTELWORLDTOUR
Gold: Just to pick out one highlight for me. It was not today in London, but was in Vienna in November last year. I met a fantastic contact, who I wouldn’t have known otherwise and I got 3 projects out of that. So it’s really worth while going, you never know who you’re going to meet, you never know where it’s going to lead. I would say come to these events, they are very good. They are long, but it’s worthwhile.
Wolfgang Gold was a delegate at TOPHOTELWORLDTOUR London. To attend future TOPHOTELWORLDTOUR events around the world, contact TOPHOTELPROJECTS Head of Global Events & Conferences Kayley van der Velde.
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