Hotel Online recently requested a Q&A with Andrew Cohan, MAI, Managing Director of the Miami office of Horwath HTL on his views of the hotel industry. Andrew’s areas of expertise are many, but his true passions include development of health and wellness offerings in the lodging sector. He is also keenly interested in sustainability and the opportunities to use local resources as a significant element of a hotel brand’s amenities and value propositions. Here, Andrew discusses some of his insights and observations guiding developers in these arenas to help create “transformational experiences.”

With such a robust proliferation of brands in the hotel sector, particularly in the last 3-5 years, do you see room for wellness brands? Are there any new ones on the horizon?

While there certainly is no shortage of brands in the lodging space, there is plenty of room for more offerings in health and wellness. Specializations in health and wellness retreats, accommodations, vacations present all sorts of opportunities to continually offer new approaches and amenities or experiences. And depending on the location, the lines are beginning to blur between wellness resorts and wellness clubs. Just in recent months, a new concept was announced called The Well, a private members club, backed by hospitality and condominium developers which will open its first location near New York’s Union Square next year. The Well will be a 13,000 square foot facility where the “wellness obsessed” can unwind, recharge and reinvest in themselves, for a monthly fee of about $375. Though not a hotel, the concept adds another point on the spectrum of wellness lifestyle options.

Andrew, do the newer wellness brands have more mass market appeal than we’ve seen in the past? Or are the newer brands still appealing to that high end luxury market?

In my years of working with experiential resorts, I have observed that they are not easily duplicated or integrated by the traditional “heads on beds” hotel companies. Miraval, for example, has been known throughout the wellness industry for its emphasis on ‘mindfulness.’ Its new parent company Hyatt, however, has brand pillars founded on a broader base of lodging and lifestyle offers. Time will tell if the essence of Miraval can be sustained compared, for example, with how the Kimpton brand maintains its essential brand pillars within IHG.

Speaking of IHG, the company has implemented a wellness-focused hotel brand for the upscale, rather than luxury-tier market. The Even brand not only has exercise equipment and yoga mats in each guestroom, but also features specialized lighting, refillable water bottles, and windows that open, displaying several features found in “well building” standards. That is, construction and design features of buildings that promote the health and wellness of those who occupy the buildings.

Why have we not seen wellness brands grow to the scale of other lifestyle brands, such as Element or Aloft?

Not surprisingly, so many experiential resorts and hotels are single-property operations. They are often expressions of, or extensions of, a world view or an aspect of life to which the founder of that hotel is devoted (and heavily invested). Whether the focus is surfing, yoga, longevity and anti-aging protocols, or appreciating nature, we have observed this pattern in working with many clients who aspire to, or have achieved, the development of a sustainable resort business model. That is, they themselves are the role model guest, or belong to the target market segment of the planned resort or hotel.

What are some of the challenges you see as owners and developers pursue these types of projects?

There seems to be a continual race to keep up with resort guest expectations. Just as developers and owners get the knack of providing the right mix of products and services for the experiential traveler, they now find that guests are no longer satisfied with “just experiences.” Guests today seek “transformational” travel. As we provide a host of customized experiences, guest satisfaction increases, yet new needs arise. Thus developers need to create even more incredible spaces and experiences for today’s expectations of the traveler. There are, however, several issues to watch out for, such as whether the remote locations for some of these unique accommodations can support the level of development investment required; retention of employees in such destinations for the long term; and very notably, the availability (or lack thereof) of development funding for such projects.

With these types of potential obstacles, is it still worthwhile to build sustainable hotels?

It is to be expected that some sustainable lodging efforts or concepts may fail for being too remote, for appealing to an extremely small niche, or for over-structuring the guest experience rather than providing a blank canvas and tools with which guests can create their own experiences. But despite a potentially high failure rate, those who succeed reach a balance in these and other factors to create a scalable product, with an economically beneficial positioning strategy. They will have great success. The difficulty of getting so many development factors right creates its own barrier to entry; however, pursuing these measures protect those who do succeed in developing and operating resorts where “transformational” experiences happen — where the business model sufficiently sustains employees, adds value to the local community as well as the natural surroundings, and rewards the capital stack participants.