Hotel Development Cost
JANUARY 2011
HVS HOTEL DEVELOPMENT COST SURVEY 2010
Elaine Sahlins Senior Vice President, HVS San Francisco Consulting & Valuation
HVS Consulting & Valuation | 100 Bush Street, Ste 750, San Francisco, CA 94104, USA
HVS Hotel Development Cost Survey 2010
Elaine Sahlins – January 2011
HVS has tracked hotel construction costs throughout the United States since 1976. The survey considers data for six lodging types: Economy/Budget Hotels, Midscale Hotels w/o F&B (without Food and Beverage), Extended-Stay Hotels, Midscale Hotels w/ F&B (with Food and Beverage), Full-Service Hotels, and Luxury Hotels and Independent Resorts. The 2009/10 hotel development survey reports updated per-room development costs for through the end of 2010. Each year HVS Consulting and Valuation researches development costs from our database of actual hotel construction budgets, industry reports, and uniform franchise offering circulars. These sources provide the basis for our range of component cost per room. New project construction cost data collected each year may increase the range and/or impact the mean and median of the construction cost components. The upper and lower ends of the ranges are adjusted by changes in construction cost components derived from published sources and information from architects, contractors, developers, lenders, and other professionals involved with hotel development projects. This year’s development cost survey reflects actual ranges of development costs in each category. The survey is not meant to be a comparative tool to calculate changes from year to year but represents the true costs of building hotels across the United States. As with previous years’ data, the data represent a wide variety of geographical locations from tertiary markets in the Southwest to mid-Manhattan. The development costs of the same hotel product, say a select-service Fairfield Inn or Holiday Inn Express, can be more than triple the amount from one locale to the other.
HVS HOTEL DEVELOPMENT COST SURVEY 2010
Elaine Sahlins Senior Vice President, HVS San Francisco Consulting & Valuation
HVS Consulting & Valuation | 100 Bush Street, Ste 750, San Francisco, CA 94104, USA
HVS Hotel Development Cost Survey 2010
Elaine Sahlins – January 2011
HVS has tracked hotel construction costs throughout the United States since 1976. The survey considers data for six lodging types: Economy/Budget Hotels, Midscale Hotels w/o F&B (without Food and Beverage), Extended-Stay Hotels, Midscale Hotels w/ F&B (with Food and Beverage), Full-Service Hotels, and Luxury Hotels and Independent Resorts. The 2009/10 hotel development survey reports updated per-room development costs for through the end of 2010. Each year HVS Consulting and Valuation researches development costs from our database of actual hotel construction budgets, industry reports, and uniform franchise offering circulars. These sources provide the basis for our range of component cost per room. New project construction cost data collected each year may increase the range and/or impact the mean and median of the construction cost components. The upper and lower ends of the ranges are adjusted by changes in construction cost components derived from published sources and information from architects, contractors, developers, lenders, and other professionals involved with hotel development projects. This year’s development cost survey reflects actual ranges of development costs in each category. The survey is not meant to be a comparative tool to calculate changes from year to year but represents the true costs of building hotels across the United States. As with previous years’ data, the data represent a wide variety of geographical locations from tertiary markets in the Southwest to mid-Manhattan. The development costs of the same hotel product, say a select-service Fairfield Inn or Holiday Inn Express, can be more than triple the amount from one locale to the other.