Repurposing hotels has become a growing trend in recent times with experts looking to make the most of pre-existing real estate to reduce environmental impact. From environmental to economic, there are a variety of factors to consider when repurposing an asset into a hotel; keep reading to find out the five things you need to know before you start your next hotel sector project.

Repurposing often involves the remodelling of older buildings with significant heritage value – with these buildings, which are often no longer used for their intended purposes, we commonly inherit historic materials such as natural stone, cast-iron steel work, ornate timbers and architectural detailing which cannot be achieved in new-build constructions due to economic constraints.

Transforming an aged and worn-out building into a remarkable modern hotel embodied with character is a remarkable achievement, but one thwart with unforeseen risk, which is incredibly hard to forecast/quantify. These issues often relate to significant structural alteration and remediation requirements, service coordination and restoration of elements of heritage value. The issues are often discovered during design developments and whilst the works proceed, therefore it is essential that a healthy contingency margin is considered in initial development appraisals.

Repurposing an older building into a new hotel has tremendous environmental benefits. The very nature of these projects aligns with ‘reduce, reuse and recycle’ through the adaptive reuse of the foundations, super-structure, and many internal elements. Repurposing in this manner does not only eliminate the embodied carbon which is released during the manufacture of raw materials for a new structural build, but also allows the developments to be energy efficient. Whilst the structures are generally historic, the internal design, particularly MEP designs, are developed to the same performance standards as they would be with new build developments – essentially achieving a building of outstanding character and architecture whilst being as energy and operationally efficient as a new purpose-built hotel.

Repurposing developments often provide a time benefit – achieving a much earlier start on site. Initial design development and planning approvals can often be achieved in a timely manner due to the reduction on preliminary investigations and base designs required. For example, converting an existing building would not require any percussive drilling/geotechnical analysis to determine the sites geology and local authorities are regularly supportive of investment in depleted assets that hold value to the local area. Achieving an earlier start on site not only has a programme benefit but allows the project cashflow to start, reducing the period in which the developer may have to be self-funding.

Hotels provide reliable investment potentials. Hotel leases are significant in length and involve tenants with strong covenants providing both regular income streams and attractive assets for resale. Engaging with a competent operator with the right strategy sees these completed developments promptly achieve stabilised occupancy.

If you would like to know more about repurposing hotels, or how we can help with your hotel development, get in touch with our Hotels sector lead Nathan Hooper.