Our client—owner of a hotel and marina in the Caribbean—noted repeated underperformance of the occupancy rate and average price compared with the annual budgets submitted by the manager. As a result, the EBITDA was insufficient for covering the financial debt and meeting the shareholders’ expectations of profitability. This situation required a series of new equity contributions from the client. As the end of the management contract drew near, our client wished to obtain an independent opinion on the current performance of its establishment in relation to its cruising potential as well as the recommendations and actions to be implemented in order to achieve this.
Sentinel Hospitality implemented a three-phase approach to establish the diagnosis, build the strategy, and manage change. To do this, we conducted in-depth fieldwork (30 interviews over seven days) which enabled us to define the set of comparable hotels and analyse their main management ratios.
Added value generated
- Identification of a conflict of interest with the manager regarding the appropriateness of the positioning implemented in relation to the performance of comparable hotels.
- Assisted the owner in taking over the marketing of the hotel and significantly improved performance within 18 months.
- Executed a strategy to increase value by developing the marina and selling residential properties.