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Empty Hotel or Luxury Senior Facility?
By Benoit Gateau-Cumin
Saturday, 19th October 2019
 

Hotel and recruitment insights at 4Hoteliers.comThe year is 2040 (only 20 years from now), demographics in the US are leaning very heavily toward seniors and in fact, 55% of the population of those with a net worth of $2 million or more, are over 65.

Gen X never amounted to a substantial percentage of our population.

At the other end of the spectrum, the Millennia, who by now are in their early forties, are almost as numerous as the seniors. They do well, with salaries substantially higher than what the Gen X have been earning.

Senior living facilities are running 100% occupancy with waiting lists in most of them. They range from 6-stars down to 3-stars. Baby boomers are NOT poor.

Hotels, on the other hand are having a very hard time: there was a great deal of overbuilding that took place between 2005 and 2020, just as the high-income demographics started to fade.

When demand exceeds supply, which it will continue to do for at least 10 years, you need to build.

Never mind and save your billions: those thousands of hotels running under 50% occupancy can barely (if at all) service their debt.

Building a luxury senior living facility from ground up can cost up to $400K per room (in 2040, probably more like $550K). Converting a luxury (or not so luxury) hotel into a senior living facility, in comparison, costs pennies per room. Well, maybe not pennies, but no more than $5K for something very, very nice.

By the way, if you need construction capital, some of your guests will be happy to look into an investment program that makes fiscal sense to them. Older don’t mean stupid.

Just like the airlines and hotel groups have their frequent guest programs, so do today senior living groups. They also have reciprocal agreements globally with facilities of the same level of quality. Pre-arrival has been perfected to a science: your medical history, food allergies and prescriptions are forwarded prior to your arrival. Your favorite TV programs too, as well as your candy and sherry of choice.

Benoit Gateau-Cumin - Chief Recruiting Officer. Born and raised in France, Benoit managed to scoop up a French law degree prior to studying Hotel Administration at Cornell University. Upon graduation in 1975, he engaged in an eleven-year hotel management career that took him to Chicago, New York, Washington DC, San Diego, Istanbul, Jamaica and Hawaii. He held positions with Omni, Hyatt, Hilton International, ITT Sheraton and Méridien, as well as Honolulu’s unique Halekulani, consistently rated as one of the world’s best.

Benoit was bit by the “headhunting” bug in 1986, and has not relented yet. He founded The Boutique Search Firm in February 1992. His motto: small is beautiful. Benoit loves to mountain bike, take long walks with his wife Susana and their two dogs, and tinker with his budding collection of classic English sports cars.

benoit@boutiquesearchfirm.com / www.boutiquesearchfirm.com

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