At the recent annual Scottish Hotels Conference hosted by CMS and Savills, I was delighted to host a panel session focusing on the role of hotels in placemaking mixed-use developments.
This is an area in which we have considerable experience having advised numerous local authorities and other public sector bodies on intervention to facilitate hotel development.
I was delighted to be joined by expert panelists Adela Cristea (Chief Development Officer UK, Ireland & Nordics, Radisson Hotel Group), Andy Townsend (CEO Legacy Hotels & Resorts) and Martin McKay (CEO Clyde Gateway) for an interesting discussion.
There are numerous examples of hotels playing a key role in placemaking and mixed-use developments across the UK, and I was keen to explore why it is important and how it works in practice.
Of course the broad rationale of including a hotel in placemaking regeneration projects is well-known, in terms of driving additional footfall, business tourism and job creation; but are hotels getting the credit they deserve in this regard?
Furthermore, the issues with delivering hotel developments commercially are well-known, but less well understood is that doesn’t necessarily mean a hotel isn’t viable in the longer term and can’t deliver for a local authority on its economic and social agenda.
Key themes discussed included:
- Placemaking is not, as often presented simply architectural ambition, but is the deliberate creation of positive economic and social impact – aligning infrastructure, occupiers, capital and community needs
- Hotels are not passive occupiers in this mix, but are part of the economic infrastructure – importantly they drive employment, footfall and economic impact from day one
- Hotels, and particularly the involvement of an internationally recognized brand signals confidence, driving fundability and occupier interest
- Hotels provide the social and commercial glue between other uses – often becoming the informal town hall of new districts, facilitating civic, commercial, institutional and community engagement
- In scenarios where other aspects of the placemaking are intended to drive increased visitation (conference centres, arenas etc.), the provision of a hotel is paramount to the success of the wider destination
- Public sector governance and bureaucracy should not be seen as barriers to projects, but the private sector has to understand the constraints that the public sector works under. The private sector also needs to have realistic views on the level of risk a local authority is able to absorb
- The importance of transparency and robust underwriting cannot be overplayed
- Development phasing and timing of the hotel delivery need careful consideration; often it will be important to have the hotel at the front end of the journey to facilitate the other pieces of the jigsaw
- Finally, the value of a brand was debated, with a general consensus that (in most circumstances) it is very important, providing global distribution reach, corporate account capture, funding confidence and an attractive asset at exit.
To discuss the role of hotels in placemaking mixed-use developments or a specific project, contact Andrew Renouf at andrew@arhospitalityconsulting.co.uk or on +44 7584 186520.