It's no surprise that the one-two punch of the September 11 terrorist attacks and the stagnant economy has slashed the number of hotel development and renovation projects scheduled for 2002. Marriott will open 125 properties this year, versus 170 in 2001; Renaissance Hotels & Resorts will open only 10 hotels in the coming year; and Starwood Hotels has also reported a slowdown.
Jonathan Howe, senior partner at Chicago-based law firm Howe & Hutton Ltd. and a tutorial leader at RCMA 2002, urges planners to make sure that they are contractually covered when they make a pre-opening booking, on the chance that the hotel isn't finished in time for the meeting.
Howe has a few contractual suggestions on how to verify that the hotel will be ready — and how to ensure that if it isn't, the planner won't be left without a venue.
“You should have in yourthat if that hotel fails to open on the agreed-upon date, they will find you a comparably rated hotel, in the area, at their expense, so that you have a place to hold that meeting,” Howe says. “Above and beyond that, planners should negotiate a financial consideration to be paid if the hotel doesn't deliver.”
Howe also suggests thatshould demand monthly reports be sent from the hotel to the planner to track construction progress.
“Also, I would require the hotel to pay for a hotel consultant of my choice. The consultant would deliver monthly reports to me from his or her on-site inspections. Basically, I want to do everything I can contractually to make it unattractive to them to fail to deliver.”
The same philosophy holds for renovation projects.
At the 1,500-room San Francisco Marriott, a $46 million renovation set to begin November 1 was put on hold for a year.
However, the delay will have no impact on meetings, according to Chuck Pacioni, director of sales and.
“We're very careful not to overpromise and underdeliver,” Pacioni says. “The most we'll ever say is that we have a renovation scheduled to begin — not that it definitely will begin.”
But what about those cases when a planner is expecting a renovation — and the hotel doesn't do one? Or the planner has been assured there will be no renovations during their meeting, only to hear jackhammers?
“Always ask about the possibility of a renovation,” Pacioni says. “If a planner finds out there will be one, then they should talk to the general manager and the director of engineering to determine the extent of the renovation. Take it beyond the hotel salesperson.”
Too often, he says, planners fail to ask about renovation details and don't protect themselves contractually — and too often, hotels fall short of full disclosure regarding renovations that might occur at the time a meeting is in-house.
There probably is no such thing as communicating too much, Pacioni says.
“There should be heavy responsibility on the hotel to overcommunicate renovations to the meeting planner so that everyone knows what's happening,” he says. “This is especially true in cases where renovations are planned after the contract is signed.”