As a rental real estate investor, you may be considering investing in a hospitality property. If so, it’s essential to understand the ins and outs of hospitality property management. Since most hospitality properties operate 24 hours a day, 365 days a year, having the right property management team and systems in place, is of great importance to ensure the property is successful. Below we take a deep dive into everything you need to know about managing hospitality properties.
Hospitality Property Management Defintion
Hospitality property management is a specialized type of real estate management that deals with the comprehensive oversight of operations for hospitality-related properties such as hotels, resorts, and restaurants.
Hospitality Property Management Services
Although there are many different types of hospitality properties, the primary goal of hospitality property management is to ensure that guests of the property have a positive experience from the moment they arrive at the property until the moment they check out. Whether the management services offered are select service, or full service operations, this includes everything from managing the property’s physical appearance to addressing any guest concerns or complaints. Below we take a look at some of the most common hospitality property management services:
- Guest Customer Service
- Property Operations
- Property Marketing and Advertising
- Revenue Management and Budgeting
- Accounting (Accounts Payable, Accounts Receivable)
- Staff Development and Human Resources
- Food and Beverage Management (Inventory and Staff)
- Safety and Risk Management
- Facility Maintenance and Property Upkeep
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Hospitality Property Management Fees
The fee to manage a hospitality property can range between 3% and 6% of the gross operating revenue, depending on the type of property and terms of the operating agreement. Most contracts to manage hospitality properties are made up of 2 components – a base fee and an incentive fee, which is paid based on a certain percentage of revenues. These incentive fees are designed to make the onsite management more conscious of the property’s bottom line.
Hospitality Management Software
Hospitality management software is the invisible force that helps hospitality property owners, managers, and guests enjoy a seamless experience from beginning to end. Rather it be a hotel check in, theme park POS or event venue center financial reporting, the right real estate software can bring immense value to your property.
Hospitality Property Management Jobs
Hospitality property management requires a team of experts. From housekeeping and property maintenance staff to front desk and food & beverage employees, it takes a team of experts to properly manage a hospitality property. A good property management team will have a deep understanding of the hospitality industry and will be able to utilize the strengths of each team member to provide the best possible guest experience. Due to the complexity of the hospitality industry, managing a hospitality property can be a complex and challenging field. From keeping up with the latest industry trends to managing a large and diverse team of employees, there is a lot to keep track of.