News for the Hospitality Executive
Understanding ADA Implications When Renovating or Repositioning your Hotel
|By Jim Butler, April 9, 2009
As a sign of the times, we are working with the owners of several distressed branded and independent hotels (particularly extended stay hotels) and condominium hotels to explore whether a conversion to timeshare or fractional may be a preferable use. Although the timeshare receivables financing market has been crushed by the general credit crisis, there are still limited sources of qualified consumer financing available for timeshare acquisition purposes, and even with downward pricing pressure on timeshare sales, the economics of timeshare properties in certain locations may be more attractive than continued operations of distressed hotel properties.
Whether we are advising our clients regarding the conversion of an existing hotel project to vacation ownership use or the conversion of a hotel property from one brand to another, the rebirth typically involves some renovation or modification. Whether a renovation is necessary due to conversion, a product improvement plan or otherwise, the owner and operator of the property need to be cognizant of the issues outlined in the article below. The article below was written by our own hotel and time share lawyer, David Sudeck, in consultation with JMBM's ADA expert Marty Orlick.
When you renovate or reposition your hotel (or timeshare
By David Sudeck and Marty Orlick
The Global Financial Crisis is motivating lenders, developers and operators
to get creative. We at JMBM are busy looking at opportunities with our
clients to purchase and/or reposition distressed hotel properties, unsold
condo hotels or condo hotel inventory (see articles on how to "uncondo"
a condo hotel elsewhere on www.hotellawblog.com), and unsold timeshares
and timeshare inventory. Some of these properties will need to be renovated
and repurposed to compete in this difficult market. It is important to
understand what physical modifications to a timeshare, hotel or other facility
may involve upgrades under the Americans with Disabilities Act and applicable
state disabled access laws.
Relevant provisions of the ADA provide that "discrimination" includes, "a failure to make alterations in such a manner that, to the maximum extent feasible, the altered portions of the facility are readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs. Where the entity is undertaking an alteration that affects or could affect usability of or access to an area of the facility containing a primary function, the entity shall also make the alterations in such a manner that, to the maximum extent feasible, the path of travel to the altered area and the bathrooms, telephones, and drinking fountains serving the altered area, are readily accessible ... where such alterations ... are not disproportionate to the overall alterations." That being said, the Department of Justice in its implementing regulation does recognize that normal maintenance and certain upgrades that do not affect the "usability" of the building or facility are not alterations.
Where certain alterations are made, it is possible that the "path of travel" to the altered area must also be made accessible for the disabled, and the defined "path of travel" may be much broader than you would expect. However, the cost of modifying a "path of travel" may be considered, when it was the alteration of a portion of a property that triggered the additional requirement to make the path of travel to the altered area accessible. Specifically, a proportionality requirement (looking at the cost of modifying the path of travel in proportion to the cost of the unit alterations) can limit the extent to which a supporting area must be made accessible. A different standard may apply when architectural barriers exist that limit accessibility. This analysis is complex, and you should be sure to have competent counsel and consultants review the standards and the facility with you.
Should you be concerned?
The Department of Justice and local Attorneys General offices are stepping up the enforcement of federal and state accessibility requirements. The factors relating to compliance requirements are not straightforward, but JMBM's attorneys have deep experience in this area of the law, and you should consult with ADA counsel in connection with any renovation that you are contemplating or undertaking. Our ADA attorneys also work with other experts to conduct independent surveys of our client's hotel and resort properties to assess the level of accessibility and recommend cost-effective ADA compliance strategies.
About the Author:
|A New Sheriff in Town, the Department of Justice Auditing Hotels for ADA Compliance; Cost Effective Steps for a Proactive ADA Compliance Program / March 2009