MANCHESTER, England — Integrating sustainability into hotel development is somewhat of a new frontier for the hospitality industry.
There's no established starting point for sustainable hotel construction or renovations, no guidebook, no industry standard, few if any government laws or mandates.
So how should hoteliers proceed? Some hotel construction projects might have environmental, social and governance guidelines right from inception, but each project is different, and stakeholders — from hotel owners to lenders and global brand companies to operators — all have their own priorities.
Gregor MacNaughton, chief technical officer at RBH Hospitality Management, said that 75% of RBH’s managed hotels are affiliated with brands, which exert some pressure to meet ESG goals.
“The [U.K.] government will have to come up with some standards that all hotels will have to abide by. We do take what we consider the best bits of IHG [Hotels & Resorts] and Hilton best practices, and we extrapolate that across our estate. Then we have our own monthly standards for their fee rewards,” he said on a panel on sustainable hotel design and construction at the Annual Hospitality Conference.
But the number of stakeholders involved in getting a new hotel open can sometimes result in confusion around sustainability efforts, practices and messages. Until there is a solid line under best practices and regulations for ESG in hospitality, the field remains soggy underfoot, speakers said.
“We have 25 owners, all with different needs and wants. We have done projects of around £17 million to £20 million [$22.2 million to $26.2 million], and we have done small [furniture, fixtures and equipment] changes,” MacNaughton said. “All projects come with different views, and different views from ours. We also have an owner, a French fund, with very strict policies. Overall, this is not happening as quick as we would want.”
Steve Walford, vice president of Cedar Capital Partners, said he mostly works in the full-service boutique and lifestyle sector. He added that many hotel owners still need to be taught the benefits of such capital investment into sustainability.
“You have to coach owners of the investment potential, and then they will do it, or sometimes they have to do it,” he said.
Walford said making the investment in sustainability now can be a monumental decision for hotel owners, one that can lead to a shift in thinking on future projects.
“It has to come down to the philosophical heart of your business. If done properly, it will guide every decision in the future,” he said.
For some hoteliers, such as Ben Harper, CEO of Watergate Bay Hotel, Another Place Hotels & Beach Retreats, becoming more profitable while being greener is less of an issue and more of a mandate.
"We have done as much as commercially possible, but perhaps not as much as we could. We are hotel people, not scientists, and it is a minefield out there. It causes severe head-scratching when we try to assess what are the best technologies,” he said.
Some might look at the issue based on government advice, while others do so with some environment ratings agencies and organizations in mind, Walford said.
Harper said the hospitality industry has a responsibility to translate all advice, regulations and common sense into meaningful actions that best serve the communities where the hotels are located.
Types of projects
In the United Kingdom, it's difficult to find willing partners for new-build hotel projects. So much of the discussion involves conversions or refits of existing properties, MacNaughton said.
“This is the first year in which we have had no new builds. We have one on hold,” MacNaughton said. “Rather, in the last three to four years, investors have started to focus on what they can do to enhance the properties they own.”
The advantage is that there is more onus on conversion and refits, he said.
Due to rising inflation in the U.K. and around the world in the last 18 months, investors are placing more capital into conversion projects to open new hotels.
“We have managed to get permission for extensions, and, due to rising energy prices, we have invested in relevant technology. All that is good to see, but we have one owner who has not invested yet in LED, which is a little crazy, while others are on top of it,” MacNaughton said.
There's even a higher barrier to leveling a historical building to make room for a new-build hotel in some U.K. markets, Harper said. Ultimately, keeping the cultural feel of a building might mean it's more prudent to keep its facade and just update its interior.
“My hotels are on Cornish and Lake District beaches, in Ullswater, in the Scottish isle of Islay, so we would never feel right in knocking a building down even if that was the best way of constructing a hotel that ticked all the right boxes. It might sound trite, but [our company] is about community first, filling beds second,” Harper said.
Futureproofing is key, Walford said.
“We should always be thinking of the next generation, to look at buildings that can be refits. In London, we have a hotel that has a central core of 14 stories that could be taken out. The embodied carbon of that can be here for hundreds of years,” he said.
He added the type of 1970s shortsighted thinking of the era of RAK concrete must be banished.
“Now let’s be long-sighted,” he said.
Reason for optimism
On the bright side, there's a big push to embrace sustainability in hotel development and make such historical buildings more efficient. And some countries are making waves in setting sustainability and energy efficiency standards, such as Australia’s NABERS accreditation.
“NABERS originated in Australia. It is only available in offices in the U.K., but it is hoped it will be expanded into hospitality. It needs to be pushed more,” Walford said.
More research is needed in the form of case studies and white papers to document lessons learned, which will help sustainability goals be at the forefront of any project, panelists said.
Harper said he hopes such common sense and goodness never become a marketing message that is “thrown into guests’ faces. The real success comes from when our staff and guests tell us what we should be doing.”
“Our vision is not to be a leader in sustainability, but to be the best lifestyle brand,” Harper said. “Little gains lead to big gains, and it is little gains that improves guest perception.”