Choose competitors by the guests and occasions they compete for, then test the property differences. A benchmark set is a group of competing hotels selected for comparison; it is not simply a collection of properties with desirable room rates. (costar.com)
Build three separate comparison lists
- Operating competitors: hotels competing for similar guests, dates and occasions.
- Positioning references: hotels whose product or experience informs the proposed concept, without assuming their economics transfer.
- Transaction comparables: sold assets used to investigate pricing, capital requirements and investor expectations.
For every candidate, record micro-location, travel time to demand generators, room mix, service level, amenities, affiliation, renovation status, meeting/event capability and seasonal trading pattern.
What local evidence should you collect?
Contact the destination marketing organization, convention bureau, planning department, major demand generators and selected local business travel or event buyers. Request dated evidence of room-night demand, event calendars, project status and accommodation needs.
Use an interview log: person, role, date, question, response, underlying evidence and potential commercial interest. Treat an interview as a lead until its important claims are corroborated.
For supply, distinguish a concept announcement from an application, approval, construction start and opening. Model the hotels most likely to compete during your hold period rather than assigning every announced project the same opening probability.
What if achieved competitor performance is unavailable?
Do not reverse-engineer confidential ADR or occupancy from public booking prices. Request properly licensed benchmark reports or owner-authorized information, preserving the permitted audience and use. STR’s reporting guidelines expressly restrict reproduction and distribution without permission. (str.com)
If access is unavailable, say so. Build a wider range, document the positioning assumptions and avoid publishing a spurious national boutique RevPAR benchmark.
Gate 4: reject a forecast that requires both a large rate premium and higher occupancy without identifying the demand source, distribution route and service cost supporting each assumption.