Over the past few decades, there has been a growing trend globally of hotels and resorts adding waterpark attractions and features. Some properties have added one or two slides, and some have built a substantial waterpark attached to the resort.
Hotel & Leisure Advisors conducted a study to analyze the performance impact on hotels and resorts with waterpark equipment such as water slides, interactive multilevel water play structure, splash pads, lazy rivers and wave pools. This article highlights the results of our global survey and quantifies the effect that waterpark equipment has on the performance of hotels and resorts.
For this analysis, we obtained occupancy, average daily rate, and revenue per available room data from STR, CoStar's hospitality analytics firm, for five groupings of hotels and resorts located in North America and one grouping of hotels and resorts located in Asia and the Middle East, including:
- Hotels and resorts in Florida and the Caribbean with outdoor waterparks or aquatic features.
- Hotels and resorts in the United States — excluding Florida and Caribbean — with outdoor waterparks or aquatic features.
- Hotels and resorts with indoor waterparks over 50,000 square feet in the United States.
- Hotels and resorts with indoor waterparks or aquatic features less than 50,000 square feet in North America.
- Hotels and resorts with outdoor waterparks in Asia and the Middle East.
The research found that, compared to broader market performance, all groups except hotels with small waterparks achieved higher RevPAR. The addition of waterpark amenities helps the hotel attract more family guests during the weekends and on holidays, and in many cases allows the hotel to charge a higher room rate than other comparable hotels.
As part of the research, we interviewed a number of properties and analyzed performance data on 14 lodging properties in further detail and compared their performance levels with regional and local market data as case studies.
Our analysis showed that lodging properties with waterparks and/or waterpark equipment had RevPAR levels ranging from 17% lower to 145% higher compared to the local/state level market data and 23% lower to 144% higher compared to national data.
The properties profiled offer indoor and/or outdoor waterpark features and amenities of varying sizes — from a single slide at an urban hotel to a large waterpark at a resort property. Property sizes ranged from a 68-room limited-service hotel to a 1,814-room convention center resort. Properties are located in a variety of markets, including urban and suburban markets and tourist destinations. Some properties profiled are located near or along beaches while some are in mountainous regions. Some properties are near a major attraction, such as a theme park, while some are the attraction in the market.
During our interviews, hotels such as the Hilton Salwa Beach Resort in Qatar commented that the resort achieved a competitive advantage over other resorts in the wider market area because of the waterpark amenity. Paradise Resort Gold Coast in Australia cited an increase in length of stay and higher food and beverage spending. Resorts such as the Great Wolf Lodge and Kalahari Resorts in United States achieved higher occupancy, ADR and guest spending levels compared to other resorts in the market. Resorts such as the JW Marriott Hill County and Gaylord Texan in Texas reported attracting more families to the resort after the waterpark addition and higher food and beverage revenues.
Hotel & Leisure Advisors has completed more than 3,000 studies for hotels, resorts, waterparks and leisure properties across North America and internationally. Our experience within the industry is that resorts offering waterparks or aquatic features tend to outperform those hotels without waterpark equipment.
As consumer spending and shopping habits change to reflect a focus on experiences, hotels and resorts are in a good position to adapt. However, experiences have to be dynamic, and hotels and resorts need to offer unique experiences that other hotels in the market do not offer. This is where the inclusion of waterpark equipment can set a property apart as a market leader.
The data obtained from STR, profiles of select properties and our online survey indicate most hotels and resorts have benefited from having a waterpark or aquatic feature. Hotels and resorts add waterpark equipment and features to:
- Increase occupancy, average daily rate and food and beverage revenues.
- Increase leisure segment demand by offering more amenities.
- Increase customer satisfaction and improvement in ratings.
- Remain competitive with or to gain a competitive advantage over other hotels and resorts in the market.
- Extend length of stay at the property.
Hotels and resorts are expanding their reach as leisure destinations for families looking for a convenient weekend getaway or vacation. Growth continues across a multitude of market types. Hotels and resorts have discovered that to attract families to their facilities and keep their repeat guests coming back for more, they need to continually work to add new components. The inclusion of waterpark equipment may bridge the gap for many properties, bringing a renewed energy, along with a complementary boost in performance.
Nuresh Maredia, CHIA, contributed to this article. This article is based on research conducted for WhiteWater; click here for the full report.
David J. Sangree, MAI, CPA, ISHC, is president of Hotel & Leisure Advisors (H&LA), an international hospitality consulting firm. Email him at dsangree@hladvisors.com.
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