By its nature, no matter the asset class, any hotel investment is wedded to a given community.
During our investment due diligence and underwriting process, we are always paying close attention to traditional assessments such as an area’s major employers, governmental and educational institutions, tourist attractions and other key demand drivers; our existing and prospective industry competitive set; and barriers to entry. However, in today’s complex, fast-moving and often unpredictable social and economic environment, it’s incumbent on investors and property managers to “drill down” as perhaps never before on local factors.
These concerns involve much more than knowing which employers are downsizing or even scheduled to move out of an area, as well as which ones are growing or moving to the area; the local business climate; or more granular items such as pending or needed road improvements, tax rates or utility costs. What about the availability of labor and factors affecting job attraction, including for our team members? What will be the housing affordability for workers; or the state of the local school systems, public or private? Is the community still recovering from a natural disaster or a public safety incident? Even weather patterns are important considerations.
Community Connection
Moreover, hoteliers must be great marketers, not just to our prospective guests, but to our own team members, most of whom will be drawn from the local community. Participating in job fairs, maintaining an active presence and posting on hospitality-oriented and other job sites, creating a good web and application portal, talking up local school counselors, participating in referral programs, and offering competitive wages and benefits are all important parts of this marketing.
But how can we invest, not just market, to our prospective team members and, by extension, the community at large? I have written in previous columns about devising ways to make affordable housing available for team members, which can be especially important in communities such as resort towns where housing may be limited. Examples of longer-term initiatives might include helping a local community college develop a hospitality program; or working with local and state elected officials to establish or support a foreign worker visa program.
Our community “due diligence” can go further to ensure that we more fully understand goals and needs as we demonstrate our sincere intentions. This can take many forms, a donation of time as much as money, whether it’s volunteering in the community, serving on local nonprofit and other civic boards, or something as basic as attending a city council or school board meeting or visiting local hospitals and public service providers.
Examples of direct support for education, including of possible future hoteliers, includes our company’s annual contribution to the Astoria (Oregon) High School Principal’s Scholarship, in the name of our Cannery Pier Hotel & Spa property. The award encourages helping, health and knowledge, with each year’s winner engraved on a plaque displayed in our hotel. In Astoria, our company also contributes to the Astoria Nordic Heritage Park and the Columbia River Maritime Museum, which supports local history and heritage.
Sometimes, as with our Best Western Plus Agate Beach in Newport, Oregon, the environment and its marine life are important to the community. Here, our property is serving as a storage point for micro-plastics cleanup efforts and our general manager serves on the board of a group that maintains, manages and fundraises for sea lion docks on the city’s bayfront. These docks have been a favorite of tourists visiting Newport for ages; and this year the group has been heavily focused on fundraising to replace the docks as they were destroyed in a December 2022 king tide storm.
Ultimately, the fortunes of any hospitality property and its surrounding community are intertwined. As responsible investors, we can make a tangible difference that benefits both parties.
Rick Takach is chairman and CEO of Vesta Hospitality.
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