A Hotel Industry Expert's Take on DreamCatcher's Model
DreamCatcher Hotels: A Hotel Industry Expert’s Take on The Long-Awaited Missing Link in Hotel Development
When you are developing a hotel, more often than not, the wants exceed the needs. Architects can dream better than anyone, but when the reality of the budget sets in, you may have numerous rounds of revisions before you land on a final hotel design. It’s a time-consuming and expensive process and it is simply the way it has always been done.
Until DreamCatcher Hotels.
“DreamCatcher Hotels is a company unlike any other,” said Glenn Malone, CEO of Nashville, Tennessee-based hotel management and development company, Senate Hospitality.
“They lead owners to really look at what their priorities are, then provide the information owners need to know exactly what they can build within the budget that contains those priorities.”
Malone knows a thing or two about hotel development. He has over 30 years of experience in the hospitality industry and is an expert at the analytical side of the business. His resume includes the top names in the industry such as Holiday Inns, Embassy Suites, Homewood Suites and Hampton Inns, and large 1,500-room resorts such as Gaylord Palms in Orlando and Gaylord Grapevine outside of Dallas. He said the difference with DreamCatcher is that they have your interest in mind.
“DreamCatcher fills what, in my opinion, has been a missing piece of the puzzle for so many years,” said Malone. “You get a co-developer right at the table with you, who has a stake in the success, just like you. There is risk for them if estimates are off; there is a risk if there are numerous change orders. They have a vested interest in seeing the project through to success. CEO, Greg Hnedak guarantees his plan and his costs and once the hotel is finished, he doesn’t leave. He is there giving you discounted price on restocking orders and making sure you run a successful hotel.”
Just as microbreweries are disrupting how the major beer brands have conducted business for years; or the ‘eat local’ movement is shaking up the chain restaurant industry, DreamCatcher Hotels is changing the hotel development model.
DreamCatcher accomplishes this by providing a methodology for developing hotels that has never been attempted before. The company only hires contractors who have experience with developer-driven hotels. They ask those contractors for bids and compare the numbers with their proprietary cost database to confirm the pricing is in line with what it believes it should be. Those bids are divided into two parts – a Fixed Price for the hotel prototype and a Guaranteed Maximum Pricing (GMP) for ancillary components, such as a ballroom, restaurants, swimming pool, laundry, parking structure, and so on.
“The DreamCatcher team lays the groundwork for a successful project from the beginning of the partnership. They do the work of determining what can be spent and where it should be spent with owners,” said Malone.
In the case of DreamCatcher’s highest profile development, The Guest House at Graceland, in Memphis, Tennessee, this model allowed DreamCatcher to start the Guest House project by guaranteeing the cost of the guest rooms and suites. Development costs came in at $100,000 a key for the room components, including all fees, FF&E and OS&E. The hotel was then able to allocate the remainder of the budget towards adding unique and memorable elements, all within its $92 million price tag. Those elements included a 17,500 square foot meeting room/ballroom, a theater that seats 470, a separate catering kitchen, five food outlets, including two full-service restaurants, a gift shop, exercise room and outdoor pool with spa and event lawn. With 450 rooms, the total cost-per-key came in at $205,000 a key – an incredible price tag for a AAA four diamond hotel.
DreamCatcher offers a customizable, standard room prototype that defines the quality level of every guest touch point – whether that is the overhead rain shower showerheads, the clock radio that shows time on three sides so you can see it from anywhere in the room, or the iron that doubles as a vertical steamer. The company canvasses the industry to find which manufacturers are focused on R&D and cutting edge technology, always updating its vendors and looking for the next big thing that will improve that guest experience. It then provides those products to owners at a discounted price.
DreamCatcher can do this because of the decades of experience and the strong relationships the DreamCatcher team has developed.
“There is no other company around that has all of this on one team. It is unheard of,” said Malone.
“If you think about it in terms of the traditional route – when you sit down with an architect, they want to win the job. They want to wow you with their designs, regardless of your budget restraints. DreamCatcher is there at the table with you as a partner, as a member of your team. DreamCatcher has the bottom-line in mind and will not waste time, money and resources with plans that do not consider that.”
“With DreamCatcher you get a developer acting more like an owner would act. As an owner, that is something you don’t see at all in this business and that is why I respect the DreamCatcher model so much.”
Glenn Malone is the CEO of Nashville, Tennessee-based Senate Hospitality. He has over 30 years experience in the hospitality industry and is an expert at the analytical side of the business. Malone has worked in various operating, accounting and finance positions within Holiday Inns, Embassy Suites, Homewood Suites and Hampton Inns.