In today’s dynamic real estate market, finding the right site to build a new hospitality venture is not an easy task. When millions of dollars are at stake on a project, each and every decision counts. Location Intelligence can lay the foundation for a great investment. Find out how Horwath HTL Canada leverages ArcGIS Business Analyst Web App to produce spatial data-driven projections for clients and help them make more informed decisions.
How does a client’s hospitality real estate site ensure a sustainable and profitable business? How can I tell if the timing is right for my client to enter a specific market, and how do I communicate the value of a site to them? How does one location compare to another? These are routine questions at Horwath HTL, a global hospitality consulting organization that provides expertise on local hotel and tourism markets to developers, operators, lenders and investors.
With more than 20,000 assignments successfully delivered across 48 countries, Horwath HTL provides research and analysis in the hotel, tourism and leisure industry. Its Canadian team, located in Montréal and Toronto, takes up projects that range from hotel and tourism valuation studies, hotel planning and development, feasibility studies and site analyses to asset management, due diligence and interim management, while also including owner representation and operator search and strategic advisory services.
“Working with clients on such an exhaustive range of projects requires functioning efficiently with available data, monitoring markets across Canada closely and consistently, and running intelligent analyses. It requires a thorough understanding of market dynamics and economics as well as insights into local consumer behaviour. And it requires ArcGIS Business Analyst Web App,” says Ambika Gandhi, a senior consultant at Horwath HTL Canada.
“When our clients contact us to find out whether their site has the right characteristics to ensure a profitable hospitality business, they require specifics in socio-economic and demographic details and forecasts to determine the long-term sustainability of their proposed business,” explains Peter Gaudet, partner at Horwath HTL Canada. “As technology advances and clients’ expectations shift, our strategies need to constantly evolve. This is where we rely on Business Analyst Web App to support our decision-making with location intelligence.”
Gaudet then walks us through the whole process of how his team uses the geographic information system (GIS) app to stay ahead of the curve in the hospitality real estate industry.
ArcGIS Business Analyst Web App (formerly Business Analyst Online) provides location-based intelligence to assist with better analysis of a site under study, including understanding businesses in proximate to sites retained, and historical and forecasted demographic and socio-economic data. Until a few decades ago, most businesses made decisions based on assumptions and perceptions; now, these assumptions are backed by data-driven projections that include spatial analytics.
When the Horwath HTL team starts a project, they list all the factors that can lead to the client’s business success as it relates to a particular location. They then decide on the specific radius of an area for each analysis and determine the variables that will impact business growth, in both the short and medium term. For example, if a client is looking to construct a high-end hotel, there must be a minimum number of businesses as well as a population with a certain spending power that can support not only the hotel side of the business model but also its amenities, such as restaurants, bars and spas.
“Business Analyst Web App offers more than 7,000 variables, so we need to shortlist the circumstances that are critical to the business in question first. After selecting a radius, of say 50 kilometres, we then pull existing data from the Esri Demographics menu by selecting specific attributes, such as population, income level, number of households, number of businesses, size of businesses (for example, 200 employees or more), lifestyle and so on. We’re better able to analyze the data and substantiate our assumptions through the numerous variables presented,” says Gaudet.
Using Business Analyst Web App, Horwath HTL’s Ambika Gandhi selects a site, conducts a drive-time analysis and renders it onto a web map for her clients.
Sometimes, real estate clients require a quick market snapshot of a given area to conduct a visual analysis pertinent to a business’ success. The team also produces such snapshots when they want to compare the market potential of one location to another. Business Analyst Web App creates these market snapshots within minutes. Another important feature is the Suitability Analysis, which allows you to rank a number of locations most suited to your requirements based on a set of individually-weighted criteria. Once you’ve chosen the retained sites, you just add the variables, attributes or complementary locations. You can then assign weights based on conditions such as availability of health care or transportation facilities, low rent or the number of children in an area. Business Analyst Web App will then assign values to each of the sites and provide a final score considering all of the requested weights and influences.
“In some cases, running the Suitability Analysis tool in Business Analyst Web App, which produces the optimal data output—all within minutes—reduces our workload from days to mere hours,” explains Gandhi.
Finally, when it’s time to present the analysis to their clients, the team relies on the ArcGIS Business Analyst suite again to create visually-appealing interactive maps, convincing infographics and detailed comparison reports that support high-level business communications.
Business Analyst Web App’s “Build Infographic” capability allows users to analyze data and establish key facts for a given location within minutes.
“Business Analyst has provided us with a whole new way to present key indicators for any area of interest. Once we have the results, we can export them into Excel or as layers that can be turned into a story map. We can also create infographics which we can then export as an image or embed in our presentations,” says Gandhi. “Creating a chart is also as easy as 1-2-3. Simply select the variable you need to present and click on the Configure Chart button. Business Analyst offers a range of options for content visualization that you can’t find anywhere else.”
Real estate professionals thrive in a highly competitive industry where they not only need to understand market dynamics and economics but also learn and understand local consumer behaviour. GIS enables real estate consultants to better understand data and analyze it in ways that create a competitive advantage for their clients.
“With millions of dollars at stake on each project, Horwath HTL Canada leverages cutting-edge technology and the power of big data to ensure clients are connected to untapped opportunities in the real estate industry,” remarks Gaudet. “Staying ahead of the game is no easy feat, but we continue to lead the way confidently in the hotel, leisure and tourism real estate sector in Canada.”
This article originally appeared in the Fall 2018 issue of ArcNorth News.