The core competency of our Advisory division is our seamless integration of deep industry and functional expertise with tools and capabilities to support execution and make change happen—on a global scale.
We bring the perfect balance of long-term strategic discipline with operational know-how to deliver measurable and sustainable business growth to our Clients. As soon as a Pearl Hospitality advisor walks through your door, he or she will be already thinking of new and innovative ways for you to compete. Working in partnership with your company, we closely assess all relevant aspects of your business, design strategies to unlock new sources of competitive advantage, and support you in bringing them to life.
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Feasibility Studies and Due Diligence
Experience matters. We have pioneered a disproportionate share of agreement negotiations throughout Europe, the Middle East, and Asia. As of 2016, Pearl Hospitality has negotiated over 145-hotel, 65-destination wellness resort, and 81 restaurant agreements with a combined asset value of $5.6bn. But numbers alone are not the point. The key point here is that with so many deals closed, we know how to tell “a good deal” from “a bad deal”. More importantly, we have the relationships and negotiating power to convert bad deals into the best deals.
We manage every facet of the negotiations including both legal and commercial matters, and whilst doing that we keep our Clients dynamically informed and involved. Some of the renowned brands we have negotiated include: Four Seasons, St. Regis, The Luxury Collection, Kempinski, Waldorf Astoria, Conrad, Hilton, Grand Hyatt, Aman, Shaza, GHM, Marriot, Ritz Carlton, Mövenpick, Banyan Tree, Six Senses, Chiva-Som, Guerlain Spa, Gordon Ramsay, Alain Ducasse, Joel Robuchon, Daniel Boulud, Inakaya, Bice, Outback Steakhouse, Nobu, and several others.
Best Usage Studies
Analytical proficiency. Clients want to be informed about how best to utilize a particular asset in generating the maximum yield. Rather than the traditional approach of having architects develop the area program, they assign this crucial phase to Pearl Hospitality, who has the strategic and financial competence in formulating project parameters built on financial prudency and local market intelligence.
We rely on both quantitative and qualitative factors that collectively ensure a project is based on optimal future returns and brings a winning disruptive strategy to its local market in ensuring a sustainable competitive advantage. Our cornerstone effort involves developing dynamic financial models (10-Yr Profit & Loss, Development Costs, Investment Ratios, Income Statements, Balance Sheets, Cash Flows) that simulate, via our proprietary statistical algorithms, various scenarios involving 10M non-linear simulations of various project assumptions.
Since our models are fully dynamic, this means during our simulations a change in target hotel positioning (number of stars, hotel vs. resort, brand affiliation), the ADR, occupancy rates, development costs, and operating costs are adjusted based on actual benchmarks from comparable markets.
Since our simulations are data-intensive, they take an average of 72 hours to complete, but when all is said and done, they reveal the optimal answers:
Hotel vs Resort and Positioning (stars)
Residence components (sale, lease)
Full Area Program
Target Pricing Levels (all components)
We make sure that every project is driven by solid fundamentals, delivered through area programs with one key objective - maximizing future returns. This becomes the foundation for the design team(s) to interpret the aesthetic touches.
Our quantitative approach is the reason why our Clients are able to maximize their investment yields.
The expectations placed on boards by shareholders, regulators, the capital markets and other stakeholders have never been greater. In response, Pearl Hospitality’s board advisory experts provide Chairmans, CEO's and Board Members with an objective assessment of a firms structural integrity.
Our core services include:
Independent Performance Appraisals
Driving International Growth
Interim/Permanent Board Representation
Multi-Cultural Board Alignment
A successful business model is where perceived pricing is in relative equilibrium with the value proposition. Simply stated, disequilibrium creates loss in market share and/or financial loss.
The process of managing towards this equilibrium is rather more complex than the implied simplicity of the aforementioned sentence. This complication arises because in hospitality, an intangible asset – our emotions, is the main driver of value perception. Moreover, while some emotions are triggered by certain events during a guests experience at your operation, their ultimate source can date back weeks, months or years before they arrive.
In order to overcome this challenge, Pearl Hospitality has devised a process-focused operational handbook that combines the science of profitable hospitality management with the artistic element of bespoke service, to succumb to the highest emotional experiences of any hospitality operation while ensuring prudent business and financial performance.
Pearl Hospitalitys' multi-dimensional background as both Operators, Developers and Advisors is one of many reasons we are able to harness cross-functional experience to turnaround hotels, restaurants and spas. Our competence is a tribute of the comprehensive understanding of required soft-skills that can only be delivered by the right floor team equipped with proper training and enforced through a process-driven mindset that leverages an economics-based decision making process.
Globally and through our affiliated partners, we manage, as operators, in excess of 180 hotels, restaurants and spas predominantly in the premium market segment. This means we have the backbone to analyze, hire, train, manage and deliver quantifiable results.
Our deep-rooted experience, as both operators and owners, means we understand the risks that owners face and we have the expertise in driving change on the operational level.
We are more than mere advisors and consultants; we are your comprehensive interim management solution that diagnosis the situation, forms a solid turnaround plan, and then drives the execution to ensure economic elevation of your asset.
We take an integrated approach to corporate finance by dealing with a holistic range of issues and taking a longer view than most financial consultants.
Management is motivated to achieve a number of objectives, some of which conflict with each other. These conflicts exist because a firm has a number of constituents, such as stockholders, employees, clients, partners, suppliers and creditors. Ultimately, it is management’s responsibility to satisfy such differing desires. Thus, the conflicting objectives confronting management raise the problem of setting priorities. More importantly, it is essential for management to set priorities to use a company’s scarce resources most efficiently.
Pearl Hospitality has developed and implemented advanced quantitative tools for decision making that have been accountable for driving economic value for our clients. In simple terminology, our strength is a direct result of converting raw data into executable strategies.
Principal services include:
M&A Buy-Side and Sell-Side
Feasibility Studies & Due Diligence
Focused knowledge. At the onset, we realized the past frustrations of our Clients – they commission firms to deliver bankable feasibility studies only to be delivered mediocre studies bundled in template reports that fail realism and prudent judgment. Worst yet, the Clients often spend more time educating the firms they had commissioned in doing the job they were paid to do. This was the stimulus that Pearl Hospitality ceased in developing pioneering feasibility studies.
Our sector specialization, alongside our broad range of experience as advisors, operators and owners translates into an unsurpassable platform for Pearl Hospitality and our Clients. We deliver studies that combine financial proficiency and strategic competency, thus affording lending institutions reliability and precision in ensuring our Clients debt raising process becomes seamless. None of our work is based on templates, as we strongly believe templates dilute the unique attributes of each project and Client needs. In fact, the only constant in our approach is our methodical approach.
A key differentiator in our process is that we don’t utilize market research to define possibilities, but instead as a validation tool.
The traditional approach used by other firms has always been to first undertake market research and eventually feed this data into the financial model. This works well if every project is intended to be average and if the future is a perfect mirror of the past. We don’t believe in any of these, and we strongly believe that innovative concepts have the ability in creating new demand and disrupting existing economic trends.
But we remain grounded in reality, which is precisely why we cross-validate our financial recommendations with market parameters – but this is done during the latter stage to avoid backward bias.
Delivering sustainable shareholder growth often translates into expanding geographic boundaries and accessing new markets. While every expansion is accompanied by risks, our multinational experienced consultants come with a breadth of knowledge to ensure the opportunities outweigh the well-managed risks. Pearl Hospitality works with both operators and developers seeking to expand their legacy, through a systematic growth process that ensures consistency in repute and shareholder growth.
Our respected tenure in the hospitality field as both operators and owners gives us the advantage of objectivity and comprehensive knowledge in contractual rights and obligations.
Pearl Hospitality assumes the role of an independent hospitality-expert in managing through legal disputes between owners, operators and relevant stakeholders. Litigation Support Services team offers a broad spectrum of assistance to hospitality industry litigants and their counsels.
Operator Search & Selection
The most common mistake made is to judge a deal by the fees only. There is no doubt that fees are important, but this is one of many key factors in assessing the right partner. As hotels are ultimately a real estate investment, the impact that a given operator has on capital value of an asset is of far greater significance.
It’s not just about finding an operator; it’s about finding the right one and on the right terms. This is a process that even experienced business people should not embark on unadvised. There are a myriad of operators out there looking to offer you their terms and manage your property for you. With a 20-30 year contract ahead though, it is a daunting task to take on since you need to be sure you are selecting the right one and on the best possible terms. The value of specialist advice is clear in this process. We have extensive experience gained over many years of running effective competitive tenders and negotiating the best terms.
While operator fees are an important decision-making variable, there are several other key-factors to consider in such a long-term engagement. An experienced operator engaged under a well thought-through contract can make an enormous difference to the financial performance of the asset and its ultimate capital value. Our Operator Selection team has the depth and breadth of experience to know what to look for and how to button down the detail to protect the owner’s interests.
The process involves:
Defining the success criteria
Screening for the right operator
Benchmarking of terms and conditions
Assessing the offers
Protection of Clients position
We work on your side – we recommend and negotiate what will be the best for you. We don’t have hidden relationships with preferred operators – we give you the answer that is right for you.
We save you money – in many cases this can run to millions over the life of the contract.
We work on a contingent basis – most of our payment is due only when key milestones are achieved.
We place a strong focus on understanding our clients – we listen and deliver bespoke responses.
We are a highly experienced team – amongst our specialists are ex-hoteliers who also fully understand the operational practicalities of these contracts.
Some of the brands we have negotiated for our Clients include:
We innovate to look beyond the obvious and focus on sustainable financial advantages.
We serve as a bridge between ownership and management in order to maximize asset value and align the operation of a hotel with the owners’ investment goals.
We maintain a core philosophy of personalized service and custom-made solutions for each client.