High-Class Hospitality

Time heals all wounds, they say, and this axiom rings true of the hospitality market. In the wake of 9/11, the industry was hit hard. But with a steadily recovering U.S. economy and renewed confidence in travel, in cities such as Las Vegas, designers are going gangbusters.

“Virtually every major hotel and casino on the Strip is expanding, remodeling or refreshing its property,” says Ed Butera, P.E., president, JBA Engineering, Las Vegas.

“The major chains [in Vegas] have made record earnings, and everyone in town is shocked at how much development is going on,” adds Allyn Vaughn, P.E., western region vice president with the Las Vegas office of fire-protection engineering firm Rolf Jensen & Assocs.

But it’s not just Vegas. Broadening the geographic perspective, Gary Brennan, P.E., a senior vice president in the Los Angeles office of the Syska Hennessy Group, observes it’s really a case of pent-up demand. “The hotel market [in many cities] is clearly on a big rebound and has picked up a lot of momentum in the last year or so,” he says.

SHG is currently working on a couple of big hotel projects in California, including the Morongo Casino and Resort, pictured at left. “People want to spend money on leisure, and with interest rates still low, this helps financing.”

According to Joseph Tremblay, managing principal, Vanderweil Engineers, Boston, the sudden surge in the hospitality market has been a pleasant surprise. “We’re seeing new projects coming out of the ground—which we haven’t seen in three years,” he says.

But even though consulting engineers are seeing significant activity, this has not been a nationwide phenomenon, appearing predominantly at destination resorts, mid-market highway properties and traditional tourist spots such as Vegas, Hawaii, San Diego, Phoenix and Orlando.

“Developers are looking for a captive market, so they’re building in existing tourist locations,” explains James Martin, a regional manager with Turner Construction International’s Martinique office. At the same time, he says, developers are also trying to attract a broader range of visitors and keep them there longer.

Design follows trends

So how does one attract and keep customers? More amenities. Topping the list, at least at the high-end of the market, are spas, large fitness centers, fine dining, entertainment and retail.

“Tourists want to be able to do a lot of things without leaving the site,” says Charles Buchanan, Jr., P.E., a senior electrical engineer with TLC Engineering for Architecture, Miami. “The more high-tech the hotel rooms and the more elaborate the fitness centers, the more attractive it’s going to be.”

In addition, more upscale hotels, notes Howard J. Wolff, senior vice president, Wimberly Allison Tong & Goo, Honolulu, are adding suites that offer multi-level accommodations, sometimes with a living room, an office and bathrooms that approach 50% of a suite’s total square footage.

Even in the Las Vegas area, this notion of pampering guests is spreading, as European-style spas/golf resorts are starting to surface, such as the Ritz Carlton’s new facility and Green Valley Ranch—both well outside Vegas proper.

Business, however, cannot be ruled out of this equation, as many people on vacation still periodically work. Travelers, stresses Vanderweil’s Tremblay, need to be able to stay plugged in, which, of course, means Internet accessibility. They want business-center-type options in their own rooms—printers, faxes and even the ability to send overnight packages. Of course, the spa amenities also play well to the traveler who is strictly on business but wants a little something extra. “Fine dining, spas and fitness centers help people escape and feel rejuvenated,” says Wolff.

Catching up with casinos

From an engineering perspective, all these new services require a very different and improved M/E/P design than in the past: better telecom infrastructure; increased ventilation and water requirements; better ventilation and exhaust to accommodate heavy-duty kitchen equipment; and finally, flexible power and lighting to handle future changes in dining facility offerings. “Low-voltage and telecom systems are expanding and growing, and a lot of cutting-edge technology is being specified,” says Butera.

In Vegas, for example, casino hotels used to practically give food away, he says, but now, virtually every hotel has a world-class dining establishment. A couple of other big chages are the growing number of entertainment offerings available within hotel rooms and the need to deal with another customer demand: functional cell phones.

In fact, in many ways, Butera says, Vegas’ hotels are becoming so extravagant and complex that gambling revenue is beginning to take a back seat to rooms, dining and other non-gambling amenities. Take retail, for example. The average Strip property today is constituted of 6 to 10 million sq. ft. of retail space—essentially, shopping malls. To handle the branded retail outlets moving in, hotels are specifying the need for individual electrical and water meters for each tenant, in addition to separate HVAC systems for each space. At the same time, a big-picture HVAC scheme must be developed.

“We need to have enough outside air coming into the base building because [during the design phase] we won’t know who the future tenants are and how much exhaust they’ll need,” explains TLC’s Buchanan.

It’s the same for the spa phenomenon, as most of these spa/fitness centers are also operated by third parties.

The other space hogs in these properties are the areas reserved for conventions, exhibitions and other formal gatherings. “Multi-use is the key,” according to RJA’s Vaughn, meaning hotel designers must create flexible spaces to host changing events, be they shows, sporting events or banquets.

The sheer size of a typical Vegas casino hotel, including the current 3,000- to 4,000-room average, is enough to keep even the best of designers scrambling, but it’s protecting the people within that keeps Vaughn up at night. “The sheer magnitude of the space, the amount of people, the openness of the floors, code and egress requirements… These are all challenges,” he says.

For example, Vaughn notes that every casino’s goal is to keep as many patrons inside as possible, but this means more doors and stairwells, which take up space. “How do you accommodate that and still have an operating environment? If you have doors, you can’t have slot machines against that wall.”

Furthermore, a casino’s choice of furniture and outlandish interior design materials are frequently major fire hazards.

“The newest thing is translucent, opaque false drop ceilings, but they’re highly flammable,” says Vaughn. “More times than not, we’re able to find a way to make it work through additional protection measures, but it’s a give-and-take process.”

Indoor-air quality is yet another major M/E/P consideration be-cause smoking is permitted in virtually every casino. “We’re being asked to design systems that can better accommodate smoke,” notes Butera.

However, Wolff adds, there is only so much a mechanical engineer can do. “Smoking and non-smoking sections are like having a chlorinated and non-chlorinated section of a swimming pool. Generally, it doesn’t work.”

But while these are all major issues, perhaps the greatest challenge regarding casino-related work is the ridiculously fast-paced schedules that building teams are expected to keep up with.

“Developers aren’t shy about asking the contractor to finish three months earlier to start bringing in revenue,” says Vaughn.

Consequently, engineers who succeed in this market are the ones who can thrive in a crazed environment. In fact, Butera adds, each project seems to be more extreme than the next. This is good and bad for the design community, he says. Due to the unique nature of the work, traditionally, Butera says, casinos have stuck with a small group of local design and construction experts. However, with changing corporate structures and insurance requirements, a number of developers have started to look to larger firms.

The hospitality client

On the subject of ownership, Syska Hennessy’s Brennan says designers getting into this market will soon discover a rather unpleasant surprise: About 50% of the time, the owner and the operators of these establishments are not the same entity.

“In a lot of cases you have a mixed client. The developer, who is financing the deal, wants to keep things tightly scripted in terms of dollars, whereas the operator is more focused on long-term expenses,” explains Brennan. “It’s an interesting dynamic. We have to anticipate this and help them develop a technical program to address a tightly controlled budget and the operator’s concerns in terms of ongoing expenses.”

Turner’s James suggests that sometimes, such situations can be mitigated by encouraging the developer to choose an operator early so as to avoid redesign for the sake of the operator’s preferences.

“In addition, our role as project manager is to be proactive and make the client think early on about exactly what kind of hotel he or she wants,” he adds.

Tremblay, however, emphasizes that 50% of the time the owner and operator are the same entity. These owners are more organized and have pre-set standards by which they run their hotels.

“Anytime you can get an educated client, it’s a pleasure. We can hit a job running a lot quicker than with a commercial office building where they don’t know what they want and every project is a new adventure,” he says.

At the same time, Wolff warns his brethren that inexperience on the design side is not suffered lightly. “They expect that we’re not going to be learning at their expense and that we know what works and what doesn’t.”

Bubble brawn

After three years of declining revenue, Wolff likes what he sees ahead. “Because hospitality tracks pretty closely with the overall economic health of the country, there is now more money available for investment and a greater ability to finance projects. Everybody is pretty bullish right now, and [the market] should be up for at least the next two years,” he projects.

It’s definitely the case for Vegas. “There is significant development forthcoming in the casino industry with mergers and acquisitions and the development of remaining property on the Strip and surrounding area destination resorts,” says Vaughn. “I don’t see the bubble bursting in the near future.”

Condo Hotels the Latest Buzz

A relatively new product in the market, the condo hotel, appears to be a win-win situation for buyers and sellers.

“There seems to be a huge market right now in Las Vegas,” says Ed Butera, P.E., president, JBA Engineering, Las Vegas. “Everybody is doing condo hotels, and they’re selling them faster than anybody can imagine.”

Charles Buchanan, Jr., P.E., senior electrical engineer, TLC Engineering for Architecture, Miami, concurs: “I haven’t done a hotel in South Florida in the past three years that was just a [plain] hotel,” he says.

As a spin-off of time-shares, these hotel offerings made their appearance in the marketplace in Park City, Utah prior to the 2002 Winter Olympics. There are now essentially two brands developing: 1) permanent, isolated residences and 2) condos that are operated entirely by hotel management. Participants may take up residence a few weeks per year, but condo owners enroll their units in a rental program, thereby earning revenue in rent year-round.

So what’s the big appeal? For the developer, condo sales essentially finance the hotel project. And for the condo owners, “they’re attaching themselves to a brand hotel that really knows how to cater to guests,” explains Garry Brennan, P.E., senior vice president, Syska Hennessy Group, Los Angeles.

There are risks to this market, individual liability for one. But for TLC, a firm that has immersed itself in the condo marketplace, the strategy has been to write specs that are well structured and point out exactly what the firm’s services are going to include.

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