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Getting started – Planning a major renovation
by Suzanne Turner Downey
VP Business Development
Creative Design Concepts, Inc.
Whether you are a large branded property, or a relatively small resort, the prospect of a major renovation can be somewhat overwhelming. You have looked at the reserves, units and comment cards and decided it is time.
Where to start
The old saying “too many cooks spoil the broth” also holds true for a renovation project.
Start the process by building a team of those who will be responsible for the planning and execution of the renovation. Organize a renovation committee made up of several BOD members and/or owners that are interested in participating in this process. Select a spokesperson to be in charge of directing the committee. This committee can filter information and suggestions about the renovation originating from the owner base.
It goes without saying that the resort’s General Manager and a Management Company representative are very important members of this team. They bring all the expertise and experience from the every day business of running a resort to the team and will be the operational interface for all stages of the renovation.
With the Resort Renovation Committee together it is time to add the interior design firm. Just as the general manager and management company bring the expertise of running a resort, a design firm specializing in timeshare brings their extensive experience in renovation work and product knowledge to the team. They will survey your resort and help your committee define the scope of work. They will give you options as to how the renovation can be accomplished. Most importantly, the design firm will create a “realistic” budget so the committee will know from the start if the current reserves are sufficient to cover the capital improvements needed.
When hiring a design firm, visit their web site to get as much information as possible about their work. Ask your management company and other resort managers for recommendations. Then interview two or three firms and engage the firm that seems the best fit for the team. This collaborative process is the best way to start planning for the renovation. A blind bid format – done in theory to insure that the owners are getting the “best deal”, often defeats just that goal. The design firms have little or no input from the property and are left to make assumptions about the design direction. Each firm is often given an incomplete scope of work as well as budget numbers that do not accurately reflect the cost of the work to be done. This leads to an apple to oranges comparisons and often a less than perfect outcome. When you bring the design firm to the party during the initial stage the team works together to develop the design theme, budgets and implementation plan. This will insure a smooth renovation process and award winning results.
With your team in place, the next item is to define the renovation goals and the total scope of work to be accomplished. How much of the FF&E is to be replaced? Are there construction elements to the renovation such as remodeling kitchens and bathrooms? Are you replacing appliances, painting the units etc.? Once this scope has been established, the Designers can develop the preliminary budgets. After the budgets are in place, you can address funding issues.
If you have reserve dollars that cover your basic renovation needs and also those items on your wish list, your resort is lucky indeed. However, many resorts find that their reserves are insufficient for the capital improvements necessary and will need to explore various methods of financing the renovation.
One solution to this predicament is a special assessment. This is sometimes an uncomfortable but necessary solution to the problem. BOD’s are often reluctant to impose these fees and the payments are typically due prior to the improvements. A model unit is a good first step to address this challenge.
Another solution is to obtain a loan. If your property is considering this option, you will need to answer a few questions. Does your state allow associations to borrow? Do your bylaws permit you to borrow? Who must authorize the loan? Is it the Board or a vote of the owners? If a loan is the way to go, find a lender that understands the timeshare industry. There are several very good lending companies that specialize in timeshare financing. This method of funding will allow the project to be completed in its entirety rather than in stages. The financial impact is deferred and the owners will see and experience benefits before paying the full amount.
Possibly the renovation will need to be done in phases over a number of years and the team will need to decide how the Master Plan will be implemented. In our experience, there is a greater positive impact on owners if a number of units are totally renovated in each phase instead of replacing a few items in all units in phases. Units that are renovated in a peace-meal fashion never have that totally crisp new look and feel.
For all of the options above, if the property has the time, we strongly recommend a Model Unit. Showing a fresh new look will go a long way to persuade owners to get out their pocket books and belly up to the bar. It also provides everyone the opportunity to test the new concept. Hold an on site meeting in the Model with the renovation committee, management team and the design firm to discuss any revisions to be made before procurement begins. Prior even to the Model completion, display the colorboards and renderings in the lobby and sales center to get your owners and guests excited about the coming renovation. It will also help keep down the complaints once the renovation begins.
Accomplishing a major renovation is definitely not simple. There are so many factors that need to be considered and addressed well in advance of starting the actual work. Good planning is the key to a successful renovation as it is with many things in life. And good planning for renovation work begins with the formation of a team that will bring to the table all the experience and expertise from their field to insure the success of the finished product.
Good luck.