Abstract
As hotel owners closely monitor their investments and apply strict criteria to selecting and evaluating management companies, management contracts are being rewritten to be performance-based. This article sets forth the criteria established by owners and asset managers to select and monitor third-party hotel-management companies (including chains), and details the type and timeliness of information (reports) expected of management companies. A survey of 43 owners using management companies showed that the selection and evaluation processes give leverage to owners. Management companies are being held accountable and pressured to focus their efforts on a particular asset to satisfy owners or risk losing contracts.
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