Asset Management Report: Ezdan Hotel Refurbishment and Sustainability

This report provides a detailed analysis of the refurbishment and renovation needs of the Ezdan Hotel, focusing on improving the guest experience and increasing the hotel's asset value. It examines build quality, design needs, and the economic viability of proposed renovations, considering factors such as market analysis, investment appraisal, and stakeholder needs. The report emphasizes the importance of environmental sustainability practices, including energy-efficient equipment and sustainable operations, to minimize environmental impact and maximize long-term value. It also explores the financial value and return of the refurbishment, highlighting the impact on marketability, profitability, and competitive advantage. The report concludes by advocating for a preventive maintenance approach to ensure efficient renovations and ongoing asset management, considering the impact on customers, staff, management, shareholders, and the government.

Running head: ASSET MANAGEMENT HOSPITALITY 1
ASSET MANAGEMENT HOSPITALITY
Student Name
Institution

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EXECUTIVE SUMMARY
This report provides an analysis of refurbishment/renovation needs for Ezdan hotels based on
build quality and design needs, renovation/refurbishment of design facilities, economic
viability, and environmental sustainability practices implemented within the project, the
financial value and return of the development and stakeholders’ needs. There have been
complaints from clients regarding the quality of design and furniture at Ezdan hotel. Through
the concepts of asset management, this report shows how the company can implement minor
renovations that are environmentally sustainable and economically viable.

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ASSET MANAGEMENT HOSPITALITY: EZDAN HOTEL
Introduction
Hotel facilities are special assets that require focused and active oversight. They are
dynamic assets that produce income. If they are wisely bought, developed, operated and
disposed within the right period, they bring massive returns to shareholders. Being that the
hotel industry is cyclical and closely follows the economic troughs and peaks of a country,
they need to seek specialists’ oversight to drive returns and improve the hotel asset value
within the holding period. This justifies the need for asset management specialist services in
within hotel facilities. Ezdan hotel is a 4-star hotel found in Doha and from customer and
specialists reviews, it is in dire need of renovations. Renovation/refurbishment is a crucial
concept in asset management. It enhances the value of a facility and maintains a facility in
the competitive market. Therefore, this report provides an analysis of
refurbishment/renovation needs for Ezdan hotels based on build quality and design needs,
renovation/refurbishment of design facilities, economic viability, and environmental
sustainability practices implemented within the project, the financial value and return of the
development and stakeholders’ needs. Then, the report provides justification of the approach
to provide optimum results to all stakeholders.
Ezdan hotel has 196 guestrooms, 3 restaurants, children’s pool, playground on site,
daily housekeeping, laundry facilities, conference centre, health club, airport shuttle, and
terrace, free Wi-Fi, Air Conditioning, free parking, terrace, and 24-hour front desk and is near
the beach.

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Build quality and Design needs
The primary focus of facility management is ensuring that customers derive
maximum satisfaction from the design and presentation of the facility. Build quality and
design are among the parameters used to measure customer satisfaction (Colliers
International, 2014). Therefore, it is important to consider these aspects of the facility
because they psychologically resonate with customers. They create a feeling of well-being
and results to pleasure if one gets what he had hoped for.
Although the main amenities and location of Ezdan looks good, it is in serious need of
renovations. The guests complain that the rooms are of different quality. For example, the
bathrooms are quite small thus not leaving room for someone to maneuver. The tiles have
been regrouted and need replacement. The furniture is stained and old while the curtains and
sofas are dirty. The kitchen has little surface area left for cooking. Additionally, the
housekeepers do not do anything in the kitchen. They just clean the bathrooms, bed sheets
and floors.
Ezdan hotel has sewer problems. When one walks into the bathroom, it is
uncomfortable to the point of feeling the urge to vomit. The pies are not regularly cleaned
and the gas in the sewer makes its way into the room. The pool tiles are in bad condition.
They are falling off. This makes it risky for visitors since they could get infected or cut
themselves. Additionally, visitors complain of noise of pipe rooms below the floors caused
by the paper thin walls separating the rooms.
Renovation/Refurbishment design and facilities
The issue of service quality is one of the crucial elements of marketing theory. It is
important for hotel management to understand and meet the consumer’s expectations (Maric
et al, 2016). In hospitality, these factors grow exponentially and most of them are associated

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with the tangible attributes of hotel facilities like the design, outside appearance of the hotel,
contemporarily equipped reception desk, visually appealing brochures, attractively furnished
lobby area and availability of sporting facilities.
Good design in hotel facilities is about functionality, innovation, creativity,
performance, and build quality. It means that the space functions in a way that adds quality
to those who use them. It gives a sense of identity and community (OGA, 2013).
Additionally, it can improve the health and safety of the user hence enabling him to live a
more sustainable life in future. Therefore, to ensure that performance is optimized in the build
quality and design needs of Ezdan hotel, asset management expertise is required to help in the
layout design and function.
There are three types of renovations: minor, major and restorations. Minor
renovations are done to renew or replace non-durable furnishings. They do not interfere
without changing the physical layout and use of space (Uherek-Bradecka, 2015). Major
renovations replace and renew all furnishings and finishes within a space (Uherek-Bradecka,
2015). It may involve major modifications to the use of physical space. Restorations
renovations complete replace all systems that are functionally and technically obsolete. A
minor renovation is done after every 6 years; a major renovation should be done after
between 12 to 15 years while restorations should be done after 20 to 50 years (Uherek-
Bradecka, 2015). Based on the explanations of the different type of renovations, Ezdan hotel
needs minor renovations because most problems it is facing can be replaced or renewed.
According to the concepts of asset management, Ezdan hotel needs the expertise of
infrastructure asset management. It is a combination of financial, engineering and
management. It ensures that a cost-effective approach is adopted in designing, constructing,

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commissioning, operating, repairing, maintaining, modifying and replacing physical
infrastructures.
The kitchen area in rooms needs to be updated to allow space for visitors who would
like to prepare meals for their families. The layout should consider the physical location of
kitchen equipments that generate cold and heat (Kostyukova, 2015). For example, the ovens,
refrigerators, freezers and cooking tops can be placed in different locations within the kitchen
to ensure that energy efficiency. The tiles in the bathrooms and along the swimming pool
need to be replaced. The curtains and furniture need to be replaced. The drainage and sewer
systems need to be reconstructed to eliminate the smell coming into the rooms. Additionally,
the walls need to be strengthened in a way that does not allow noise from the pipe rooms to
get to the visitors’ rooms.
Economic Viability
For the renovations project to be successful, it has to be economically feasible. The
funding must be earned in a legitimate and transparent process. The renovations should
utilize resources and be able to earn the hotel an acceptable rate of return. Also, it should
demonstrate ability to adapt to future needs and changes in customers, ownership, regulations
and fluctuation rates.
Renovating Ezdan hotel requires a feasibility study to establish the amount to be spent
on renovation and finances available for the project. This will involve the preparation of a
market study, development of a concept study and investment appraisal (HNN, 2016). A
market study will analyse the existing supply and demand conditions of Ezdan Hotel. This
includes local, regional and international visitors segments, target market and factors that
affect its growth (Xu, 2017). Then a SWOT analysis will be developed to highlight the

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strengths, weaknesses, opportunities, and threats facing the hotel with regards to the
renovations (OGA, 2013).
After the market study, there will be a concept study. This will involve an evaluation
of the site potential in terms of the mixed use of the hotel’s elements. This will enable asset
managers to recommend commercial best use (Goyal, 2017). Lastly, there will be an
investment appraisal which will involve a ten-year profit and loss projection (Drazen Maric,
2016). This will be based on expected revenues given the market cost, profit ratios, hotel’s
occupancy and benchmarking pricing.
Environmental sustainability practices
All activities in life have impacts on the environment. They include communication,
manufacturing, entertainment, and transportation (Kostyukova, 2015). Within an hour,
millions of companies throw release waste into water, air or soil. Fortunately, the concept of
ecological sustainability is guiding organizations into activities that support the eco-system
and abandoning those that do not (Primlani, 2012).
Asset Management provides the triple bottom line approach to sustainability in
resources. It involves balancing the environmental, social and economic aspects of service
delivery. Also, it involves managing resources in a way that derive the best outcome within a
long period (Kostyukova, 2015). This way, asset management provides foundation,
framework, enables process and allows rebranding for organizations.
One of the ways to ensure environmental sustainability practices while renovating
Ezdan hotel is through implementing sustainable operations and maintenance. This will
preserve and extend asset life expectancies (Eichenlaub, 2017). Ezdan hotel requires the
development of predictive life cycle asset management programs. This will promote the

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reliability of assets at scheduled intervals (AHA, 2013). For example, heat recovered from
laundry machine can be utilised to pre-heat water supplied to the sinks. This will make people
who prefer to use the kitchen comfortable while washing (Roedel, 2015). Similarly, Ezdan
Hotel requires energy efficient equipments and lighting refurbishment to effectively match
natural lights and artificial lights. Additionally, the hotel needs a centralised system that
controls core infrastructure and equipments in the visitors’ rooms.
The financial value and return of the refurbishment
Research shows that hotels that renovate show growth in performance and quality
service delivery. This is because the players in the industry have discovered that failing to
renovate leads to decline in profitability, negative reviews and threaten franchise renewal
agreements (HNN, 2016). There are also cases when hotel renovations do not result to higher
profits. This is because most hotel managers do not understand that a hotel functions just
like the economy; there are times it will be on its peak while there are times it will experience
reduction in returns because of rough economic conditions (Kapiki, 2013). The financial
value of renovating Ezdan hotel is determined by establishing the age of renovation, the value
of what was there before and usage.
Therefore, renovations/refurbishments will ensure Ezdan hotel’s marketability,
profitability, functionality, value, and perception. Replacing old and stained furniture, fixing
sewer problems, using sustainable equipments and improving lighting will market the hotel to
external publics. It will improve their interest and induce bookings. An increase in the rate of
bookings due to the renovations will increase the value of the hotel in the market
(Bachlechner, 2013). Apart from earning higher returns on the investments, renovations will
give Ezdan hotel higher profits thus giving it a competitive advantage in the hotel industry.

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Stakeholders affected
Renovations/refurbishments affects more than the customers. It affects staff,
management, shareholders, government, and customers. The hotel customers will be directly
affected by the renovations. This is because they may not access the hotel rooms for some
time because of the renovations. The management will also be affected by the renovations
because they will experience decrease in profitability which will interfere with the supply
chain (Haussman, 2016). For some time, they will have to reduce the amount of products in
the supply chain since most visitors will not be spending the night. The government will
experience a reduction in income tax since the profitability of the hotel will go down during
renovations. Shareholders will experience a decrease in the value of their shares (Marriot,
2016). Some may even decide to sell their shares for fear that the renovations may not result
to profitability as projected. However, once the process is complete, there will be an increase
in profitability thus benefiting customers, management, and the government.
Justification of Preventive Maintenance approach
To enable efficient renovations at Ezdan hotel and maintenance, there is need to adopt
the preventive (scheduled) maintenance approach. It involves periodically taking assets
offline, inspecting or repairing them at intervals (Uherek-Bradecka, 2015). This approach is
appropriate for Ezdan hotel because it is easy to set up and execute. Therefore, the asset
manager’s job in this approach is to scrutinize the efficiency of the equipments and schedule
to raise overall equipment effectiveness.
Apart from being easy to set up, this approach will enable the hotel facility to gain
returns while being aware of the effectiveness of the infrastructure and forecasting future
needs. However, it can be costly because it does not take into account many factors that may
affect assets’ productivity.

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Conclusion
The purpose of this paper was to provide analysis of asset management based on the
renovation needs of Ezdan hotel. The facility has received complaints from customers
regarding the pathetic conditions of their rooms and services. The kitchen area in rooms is
small, tiles are dirty, there is not enough lighting, the furniture is old and stained while the
curtains are equally dirty. This analysis has established that the hotel need minor renovations
which involve replacing the affected items. Renovations through asset management will
enable the hotel to derive return on investments, improve its marketability, increase
profitability and impress customers. Therefore, before hotels can embark on renovations, it is
important that they consider the type and needs of the facilities.

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