RLA Global has released the eagerly anticipated 2021 Wellness Real Estate Report, the only benchmarking report that evaluates the tangible impacts of wellbeing and wellness on the property level performance of real estate.  

The Wellness Real Estate 2021 Report contains 23-pages of new research and provides actionable insights on how wellbeing and wellness are influencing the property level revenue and profit levels. It uses data from P&L benchmarking company HotStats to evaluate the performance of 3,200 hotels of all classes worldwide.

The pandemic cut revenues and profits in 2020 due to lockdowns and restricted airlift, but also led to an increased demand for wellbeing and wellness offerings as guests focused more on health, both mental and physical.

Roger A. Allen, Group CEO, RLA Global, said: “Uncertainty and restrictions have meant that tourism has a domestic leaning, with money being saved on flights and transfers, and reallocated to local hotel, leisure and wellness experiences.

“Hotels which can draw in the domestic leisure market have been able to recover more quickly than hotels which operate a room-only and limited-service model. Hotels with major wellness offerings were better positioned than those with wellness revenues of less than US$1mn, allowing them to drive revenues by attracting local guests to use their F&B, spa and additional leisure & sport facilities, pools and beaches.”

RLA Global cautioned that more extensive wellness offerings typically had higher operating costs because of increased energy, maintenance, utility, and payroll expenses, operating costs which meant that close attention must be paid to ensure profitability. The company noted that during the height of the pandemic, government support partially covered some operating costs, most notably payroll.

The GOP margin of major wellness hotels - those with annual wellness revenues exceeding US$1mn - was narrower, at 6.6%, than properties with minor wellness (10.2%), it was 4.1% higher than GOP margins in hotels with no wellness.  This indicates that running a major wellness operation doesn’t necessarily lead to a better bottom-line performance. 

Allen said: “Those considering investing in wellness must take a long-term approach to understand if the wellness offering will provide a competitive advantage and whether the revenue generated will provide a reasonable rate of return.”

The report is full of facts and figures relating to hotel and resort performance with wellness and wellbeing operations and is free to download.

 

 

READ OUR REPORT TO LEARN:

  • How wellness offerings contribute to hotel revenue flows and operating costs
  • What effects wellbeing has on margins and overall hotel profits (GOP and GOPPAR)
  • How the extent of wellness operations impacts profitability at the property level
  • How wellness and wellbeing affect other classes of real estate, such as branded residences
  • Read our trend forecast

 

The 2021 Wellness Real Estate Report is free to download HERE

 

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