Feasibility Study

A feasibility study is a report that assesses a hotel project’s economic viability in terms of its trading potential, positioning, competition and underlying development costs. The study applies a step-by-step approach designed to keep the engagement flowing smoothly and within the time and cost budget. Our feasibility studies typically consist of the following key hotel operations elements:

·          Recommendations on the proposed hotel’s position in the market;

·          Detailed hotel concept by room count, facilities-mix and ancillary outlets;

·          Definition of  profit and cost centres of the defined hotel on a yearly trading basis;

·          Projection of average room rate, occupancy and Revenue per Average Room (Revpar);

·          Assumptions of pricing and costs relative to the proposed operation layout;

·          Statement of estimated profit and loss (P&L) which includes all revenues and expenses;

·          Statement of cash flow projections for the project based on preliminary cost estimates and

·          Key Performance Indicators (Debt coverage ratio, IRR, NPV, Payback Period).