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At first investors asked me for hotels with 80 rooms or more. Now most of my requests are for 20 to 50 rooms, and that includes the large luxury brands. It’s a very noticeable shift towards smaller hotels, with more attention for the guest and a much bigger focus on the people who work there. So a hotel with 30 rooms is not too small anymore, it’s exactly what the market is asking for.
Transcript
What's the perfect size for a hotel? When I was in hotel school, the answer was 100 to 150 rooms because that's when a hotel works best in an Excel sheet. One general manager, six department heads, and the worst spread over a lot of rooms. So when Adrian Zeca opened up the first Aman in 1988, the rank told him that a 40 room hotel would never work. Well, most Aman stayed under 50 rooms and it has been one of the most copied brands over the last forty years. La Sala Quan Lake Como has 24 rooms, and it was voted the best hotel in the worse. But it goes even smaller. Isaac French built a seven cabin resort at a lake in Texas. He reached 94% occupancies and sold it in the end for $7,000,000. So why does small work? In a luxury hotel, the guest pays for attention, service, and design. And at 30 rooms, the employees know who's checking in tonight and their preferences, and the best need to pay for that. But in a three star bed and breakfast, charging €150 a night, there is no margin to pay anyone to deliver the service. So the owners become the employees. They need to prep the breakfast, do the check ins, and and handle the 11PM emergency, and that's fine if you have the passion for it. And a lot of people actually love it. But if you want to have somewhat of a life next to your hotel, you have two levers. You go better, 30, 40, maybe 50 rooms, so you can pay a manager and a chef, or you go niche, luxury, so you're able to charge more. So do you have a preferred hotel size? Let me know in the comments below.