The market and financial feasibility study is an essential first step in the development process.
There are five main reasons for carrying out a feasibility study for a hotel project:
a) for the benefit of the promoter, to ensure their full understanding of the risks and rewards of the project;
b) to determine the most appropriate facility provision for a given site and market;
c) to brief the architect as to what the market requires in terms of the built environment;
d) to attract the attention of an operator and to form the basis for contract negotiation; and
e) to support submissions to debt and equity providers.
In general terms, the output of a feasibility study is information, conclusions and recommendations on: