Savvy hotel operators should harness the remote working trend and adapt their space to deliver a ‘hybrid hospitality’ concept to generate an additional source of income, according to a new research report issued by global real estate advisor, Colliers International.
In the report, 'Hotels to work in – a hybrid offering', Colliers predicts that where hotels provide office space to enable co-working and interacting, turnover could be increased by up to 20%, as shown by the success of independent ventures including Zoku, which has pioneered this hybrid hospitality concept.
Similar strategies adopted by Hoxton/Ennismore, Accor, Ace Hotels, citizenM and Kerten Hospitality that are focused on the mix of work and overnight stays have also had huge success over the last few years.
‘Hotels creating a place not only to sleep and eat but also to rent out space to meet, collaborate, socialise and work is a key way that underperforming areas within the building can be optimised from a revenue and income perspective,’ said Dirk Bakker, head of hotels for the EMEA region at Colliers International. ‘You can use hotel space twice while traditional work space only once. Not only could this concept appeal to institutional investors but I would not be surprised if this becomes a permanent new form of hospitality in the future.’
More need for flexibility
During economically uncertain times, companies have had to become more flexible by reorganizing their space to accommodate varying requirements. Flexible workspace providers responded to this following the 2008 credit crisis by offering companies more room for manoeuvre in their leases, such as shorter terms, compared to traditional real estate owners.
‘The Netherlands is now a leader in Europe with the supply of this type of office space,’ noted Harold Coenders, head of workplace innovation at Colliers International. ‘Amsterdam and Eindhoven are the flex capitals of the continent supplying 6% and 5.9% of the total office stock in Europe respectively.’
Office for just one day
The business model of flexible workspace providers is to rent out their spaces for five days a week. Leasing space for only one or two days is financially less attractive for these types of companies, and is therefore rare in practice.
‘More organisations will switch to working from home in the future, supplemented with an office for a few days, or a smaller office, with flexible workplaces elsewhere. Hotels can fill this requirement,’ said Coenders.
Hybrid hospitality model
Coenders admits creating a hybrid hotel does involve some adjustments, such as the creation of enticing shared workplaces, meeting rooms and co-working spaces. ‘Some of the hotel rooms should be made suitable for working, with the bed concealed, so that you can receive visitors,’ he said.
The hybrid hospitality model is a way of using space far more efficiently so is a much more sustainable model for the hospitality and office sectors. From an occupier demand perspective, the rebalancing of the office sector can reduce a company’s carbon footprint due to them having fewer property requirements and less commuting by their employees.
