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How to choose a location for a new hotel

How to Choose a Location For a New Hotel

Choosing the right location is key to the success of your new hotel. Although a large hotel can change the very nature of a street and neighborhood, the success of a small hotel is more likely to be impacted BY its surroundings. It is important to look closely at the neighborhood and beyond when considering your hotel’s location.  

Who are your customers?  

To know if the hotel’s location is right for you, a hotel entrepreneur must first ask «who are my customers?» and then «what do they want to be near to?» The right location for pleasure travelers may be very different from the right location for business travelers. Will your customers value being near downtown and the conference centers and event spaces where their business sends them? Will they be looking to enjoy the serene countryside and regional attractions? Will they be looking for recreation like skiing, the beach, lakes, or theme parks? Will they want access to the best restaurants and attractions the city has to offer? Regardless of the answers to these questions, it would help your customers if you were accessible to the local airport, train and bus stations, and car rental locations.  

The Neighborhood  

Start by looking at the closest potential neighbors and then move outwards. Are there high-quality businesses in the nearby area that either offer services your customers may want to use or that may even help you fill your rooms, like museums or banquet halls? If there are, do the legwork of talking to the owners about how they might partner with your new hotel to offer promotions to their customers.   Alternately, are there neighbors which might be a nuisance for some customers (ie nightclubs, casinos, bars) or that are entirely undesirable for travelers (ie abandoned lots, garbage dumps)? If you won’t be adding parking, is there parking available nearby at prices that won’t be prohibitive for your driving customers?  

Talk to Owners and Neighbors  

When you find a location that is for sale, don’t just speak to the owner. Speak to neighbors to hear what they know about the owner and the previous tenants at the location. Learning about this history can put you in a much better negotiating position when the time comes.   Also remember that you can renovate an appropriate building into a hotel rather than building from scratch. If tenants in a building look like their businesses are in bad shape, the landlord may be waiting for the right offer to come along to take over the space with a successful business. Look for these opportunities which may not have a «For Sale» or «For Rent» sign posted.

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