Development sites stand out as they have already been earmarked for new construction or extensive renovation of an existing hotel. Unlike regular hotel listings, these sites necessitate significant construction before launching a new hotel brand. They offer potential buyers’ considerable freedom in deciding the design, layout, and options for their new hotel spaces. However, this freedom comes with a need for substantial investment beyond the initial purchase to get the hotel operational.
The Difference Between Development Sites and Traditional Hotel Purchases
If you’re considering a hotel purchase, you should identify development sites set aside for new construction or extensive renovation of an existing hotel. Unlike regular hotel listings, development sites require extensive construction before launching a new hotel brand. These sites allow interested buyers great freedom in choosing the design, layout, and options for their new hotel spaces. Although, they also necessitate substantial investments beyond the initial purchase to get the hotel operational.
Building on Development Sites: Exploring the Vision
The projects you can build on a development site will vary based on factors such as location, target audience, and available space. You must also consider local zoning regulations when planning your new hotel. For instance, if you’re building on development sites in California, you might need to adhere more strictly to regulations compared to other states.
Basic Hotels
Some locations are ideally suited for constructing a basic hotel. While it’s possible to add luxury amenities, being situated in bustling areas often means adhering to strict space requirements. Basic hotels typically feature guest rooms and essential amenities such as pools, fitness centers, and spaces for meetings and events.
Luxury Hotels
When additional space is available near major transportation routes, it offers the potential for expansion and diversification. Luxury hotels can enhance their offerings with amenities such as spacious conference rooms, comprehensive fitness centers, and restaurants that serve both guests and locals. Incorporating features like specialty dining, retail outlets, expansive pools, and extensive public spaces can significantly enrich the luxury experience for visitors upon their arrival at the hotel.
Cabins and Private Spaces
Some areas may be ideal for constructing small, private dwellings that guests can stay in, including cabins, luxury glamping options, and more. These additional options can help attract guests who are looking for something special for their stay.
Amenities
As part of the hotel design, many buyers will want to take into account the amenities they can provide for their guests. Options like golf courses, restaurants, meeting spaces, ballrooms, and outdoor event spaces can all bring in customers who are interested in a more extensive event than an overnight stay.
Location-Specific Options
At some development sites, new buyers may need to take the location into account when deciding how and what they want to build. For example, beachfront hotels may want to offer beach access. Hotels located close to theme parks and other major attractions may want to consider how they can offer shuttle services to those locations–and make sure that they have the space available for it.
The Pros and Cons of Purchasing Land
Purchasing land, rather than an already-constructed hotel, has the potential to offer a number of benefits.
- Full customization of available options and land
- Control over construction
- Potential for high ROI
On the other hand, it can also come with potential downsides, including:
- High upfront costs
- Market risk, if demand isn’t there as anticipated or the market fluctuates
- The potential for unexpected or hidden costs
- Meeting zoning and regulatory challenges
- The timing necessary to get permits and meet other requirements
Prior to purchasing land, buyers should carefully weigh both the benefits and the drawbacks to ensure that they are prepared for the potential challenges ahead and ready to launch their new project.
What to Consider When Purchasing a Development Site
1. The Existing Land
Many factors influence your hotel design on a new development site. You must consider existing buildings and decide whether to incorporate them into your new construction plan or demolish those that don’t meet your needs. Additionally, local vegetation and topography, as well as existing power and water infrastructure, play crucial roles in your planning. You should also take into account local architectural styles to ensure your design aligns with community standards and meets your requirements.
2. Zoning Requirements and Local Regulations
Finalizing your new hotel plans requires careful consideration of zoning requirements and regulations. These can dictate everything from the minimum distance your building must maintain from property lines to the types of structures and amenities allowed, such as pools or golf courses. Thoroughly research these regulations before launching your hotel plan. Also, remember to check for any potential easements or access requirements that could impact your development.
3. Parking
Parking is an essential element of your hotel–and it’s a perpetual challenge. Garages and parking lots can take up a great deal of available space, leaving you unable to put in all the amenities you would otherwise like to include. Even so, without adequate parking, you cannot house your guests and employees as needed. Carefully ensure that you have adequate parking for a full house and consider how you will handle any overflow for major events.
Check Out Available Properties
Are you interested in a development property that will allow you creative freedom as you design the hotel you’ve been dreaming of? At NewGen Advisory, we have a variety of available properties, from already-built hotels that need new ownership to development sites that will allow you more creative freedom. Contact us today to learn more.