News report
CBRE’s US hotel spa research

Spa is now one of the top-performing departments within US hotels, according to CBRE


A new report by CBRE Hotel Advisory, 2019 Trends in the Hotel Spa Industry, has revealed that total hotel revenue increased by 3.8 per cent, while spa departments reported increases of 4.8 per cent.

According to the report, which was released in December, revenues and profitability also improved in all types of hotel spas. The greatest increase was reported by hotels with less than 200 rooms, with a jump of 13.3 per cent. Hotels with more than 700 rooms increased spa revenue by 3.6 per cent, while hotels with 200-700 rooms saw the smallest increase in spa department revenue, with just 0.3 per cent, during 2018.

Resort hotels have also shown greater increases in spa department profits than urban properties for the first time in seven years.

CBRE also gives a breakdown of customer segmentation for all hotel spas in 2018, finding it was comprised of 53 per cent hotel guests, 4 per cent spa members and 43 per cent locals/others.

In urban hotel spas, the percentage of locals is higher at 61 per cent. CBRE says this indicates an opportunity for hotel owners to provide packages to entice the local community into their spas for different services and to convert these local patrons into members to provide a steady income stream to all areas of the hotel.

At resorts, 62 per cent of customers are hotel guests, 32 per cent are locals/others and 6 per cent are spa members.

Authored by Mark VanStekelenburg, division MD of CBRE Hotels Advisory and Jenna Finkelstein, director at CBRE Hotels Advisory, the report features 2018 revenue and expense data from 159 US hotels with spas. This is the 13th iteration of the report.

2019 Trends in the Hotel Spa Industry is designed to provide owners and operators with the means to compare their performance against that of similar facilities, or against industry averages, and to identify their level of operating efficiency and competitiveness.

“As in prior years, despite rising labour costs, decreases in other department operating expenses, along with revenue increases led to profit gains for all hotel spas,” say the authors.

In addition, the paper highlights major trends in the hotel industry, stating that sustainability initiatives have grown in popularity, as well as hotel partnerships with major fitness brands.

“Hotels will continue to succeed if wellness is seamlessly incorporated throughout the hotel. This includes offering healthy dining options, partnering with boutique fitness classes, providing top-of-the-line equipment, and socially responsible sourcing” says Finkelstein.

 


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Spa Business
2020 issue 1

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Leisure Management - CBRE’s US hotel spa research

News report

CBRE’s US hotel spa research


Spa is now one of the top-performing departments within US hotels, according to CBRE

Resort spas saw a bigger revenue rise than urban hotel spas Studio Romantic/SHUTTERSTOCK

A new report by CBRE Hotel Advisory, 2019 Trends in the Hotel Spa Industry, has revealed that total hotel revenue increased by 3.8 per cent, while spa departments reported increases of 4.8 per cent.

According to the report, which was released in December, revenues and profitability also improved in all types of hotel spas. The greatest increase was reported by hotels with less than 200 rooms, with a jump of 13.3 per cent. Hotels with more than 700 rooms increased spa revenue by 3.6 per cent, while hotels with 200-700 rooms saw the smallest increase in spa department revenue, with just 0.3 per cent, during 2018.

Resort hotels have also shown greater increases in spa department profits than urban properties for the first time in seven years.

CBRE also gives a breakdown of customer segmentation for all hotel spas in 2018, finding it was comprised of 53 per cent hotel guests, 4 per cent spa members and 43 per cent locals/others.

In urban hotel spas, the percentage of locals is higher at 61 per cent. CBRE says this indicates an opportunity for hotel owners to provide packages to entice the local community into their spas for different services and to convert these local patrons into members to provide a steady income stream to all areas of the hotel.

At resorts, 62 per cent of customers are hotel guests, 32 per cent are locals/others and 6 per cent are spa members.

Authored by Mark VanStekelenburg, division MD of CBRE Hotels Advisory and Jenna Finkelstein, director at CBRE Hotels Advisory, the report features 2018 revenue and expense data from 159 US hotels with spas. This is the 13th iteration of the report.

2019 Trends in the Hotel Spa Industry is designed to provide owners and operators with the means to compare their performance against that of similar facilities, or against industry averages, and to identify their level of operating efficiency and competitiveness.

“As in prior years, despite rising labour costs, decreases in other department operating expenses, along with revenue increases led to profit gains for all hotel spas,” say the authors.

In addition, the paper highlights major trends in the hotel industry, stating that sustainability initiatives have grown in popularity, as well as hotel partnerships with major fitness brands.

“Hotels will continue to succeed if wellness is seamlessly incorporated throughout the hotel. This includes offering healthy dining options, partnering with boutique fitness classes, providing top-of-the-line equipment, and socially responsible sourcing” says Finkelstein.


Originally published in Spa Business 2020 issue 1

Published by The Leisure Media Company Ltd Portmill House, Portmill Lane, Hitchin, Herts SG5 1DJ. Tel: +44 (0)1462 431385 | Contact us | About us | © Cybertrek Ltd