Hotel and Resort Spas: What is the right size?
When new owners of hotels and resorts are looking to build a spa, I'm often asked what the right size is. With many variables needing to be considered, I explore the different approaches and what key information is essential to your decision-making process.
Guest room to treatment room ratio
One of the most common approaches hotels take is the guest room to treatment room ratio. It can work well, however over the years of having numbers scrutinized by owners and hotel management, I began to look at the space spas consumed much differently. As well as the built spaces that were in line with the overall positioning of the hotel—always considering the value that the spa brought to the overall experience of the hotel.
There are brands such as Anantara Hotels and Resorts and Six Senses Resorts and Spa, which are heavily weighted in the spa. Therefore, they are supported from the top and part of an individual hotel and the master brands' positioning.
There are other hospitality luxury brands that have adopted spas as a driver of the guest experience. However, they still fall into the 'other operating' department, which means when comparing spa revenues to hotel rooms or food and beverage, the spa revenue in some instances can look like peanuts and sits in a lower pecking order.
So, the question still prevails – what is the right size for my spa?
Space planning to revenue ratio
With oversight of data tracking of all key KPI figures (daily, monthly, and yearly), the two key metrics to focus on and understand about how large to build a spa are;
Average Treatment Room Occupancy. The total number of hours available to sell spa treatments versus the total number of spa hours booked for treatments.
Capture Rate of Hotel guests. The number of hotel guests using the spa for treatments as a % of total guests staying in the hotel.
Occupancy rate
Typically (and this doesn't apply to all spas), but during my time working across Accor's luxury brand portfolio, we rarely saw a treatment room occupancy higher than 20-25% as an average.
This may mean that the weekends are peak periods and weekdays experienced lower periods of business, but as an average, this is what the data told us. This converts to 75% of the time our spas were empty based on a calculated number of hours available per month, reinforcing the fact that these numbers fluctuated during busy periods of business.
This could be for a variety of different reasons, such as;
There are not enough therapists to fill the rooms and support the overall hours available for booking, therefore dragging the average down.
The spa experiences peak and off-peak periods, so business fluctuates, dragging % down.
The spa is not part of the overall positioning of the hotel. Therefore, it falls below when it comes to visibility and funds to market the spa.
Inexperienced management is not being proactive with their approach to filling low periods of business.
When calculating your KPI's you can't just turn off booking hours available if staff to treatment revenue is not equal, you are still dealing with a revenue-generating space or asset. By doing this, you are falsifying your actual numbers, and so Spa Management would end up with overbuilt spas. And even if the numbers were good, they would reflect poorly due to the oversupply.
I have seen exceptions of 40-50% occupancy and some spas that experienced 80-85%, but this was less of an occasion and was due to a large percentage of outside guests using the spa, which helped fill the rooms—if this is the case, then building additional treatment rooms works. Or in instances in Asia where we may see massages included in the guest room's price, this could drive revenue down in the spa if not allocated properly.
Capture Rate
Using my time at Accor as an example, I had very high hopes for capture rates, especially for our resort properties. The expectation was approximately 5-10% for city hotels and 15% minimum for resort properties. The reasoning; a city property welcomes more business guests who spent less time in the hotel and more time out at meetings and appointments. Therefore, time for the spa was limited, and usually, any additional time was dedicated to the fitness space.
Resort property guests had more money to spend, stayed for longer periods, and had more time, yielding more business to the spa space. You always ran the risk that at a resort property, there was so much inner competition for activities and or beach time that it could still be a challenge to drive business to the spa.
The reality here was resort properties were yielding about 2-3% capture rate (unless in a location like the Maldives where they were higher), and city properties yielded about 1-2% capture rate. To put this into perspective, a 650-room resort property that welcomed outside guests still only yielded a 3% capture rate of hotel guests and a 20% treatment room occupancy on approximately 11 treatment rooms.
The only time I saw higher yields in city hotels was when it was a top-tier luxury brand where the leisure to business ratio was equal and brought more people into the spa.
The data told me that spas were being built far too large to fill the demand and capacity available. This changed my approach to building spas. I focused on building smaller spas and created an outdoor massage experience for resort properties. This meant in peak seasons we could run at a higher treatment room occupancy and use the overflow to drive business for outdoor treatments.
You could argue that if you turned away business, there would be a loss. But when you calculated staffing, operational expenses, and overall costs for the spa, you would need to have a clear case that the turn away revenue was worth building the additional space. This is something spas should always be tracking to understand potential loss of revenue. In many cases, it didn't add up.
So, what is the right spa size?
In the spirit of keeping this light, the average city or urban spa was built to support approximately 700- 800m2, including treatment rooms and fitness. This would give about six treatment rooms, a modest-sized thermal area, and approximately 100m2 dedicated fitness spaces.
When looking at a resort property, the average spa's size was approximately 1000m2, with options to have an outdoor experience. Not a massive difference in size, but these are averages taken from a group of spas globally rather than one individual unit.
These numbers did not include wellness-driven projects where an additional 300-500m2 was added to the overall space to accommodate a much larger selection of activities and services.
There are many tricks to conquering these challenges. The list is endless, and every spa model you are building is meant to be bespoke and individual based on location, culture, positioning, product programming, etc.
When building spa spaces of the future, the best place to start is asking yourself;
Where does the spa fit into the overall positioning of the hotel?
How many guest rooms in the hotel? Do we have any residence?
Is the property a resort property or a city property?
What is the competitive set like?
Do we have existing spas in other regions we can compare data?
Do you welcome outside guests and a day pass? Or is this hotel guest only?
Will you be offering membership for guests for spa and fitness?
How large is the fitness?
For more information on building the right size for your next project, contact us here at Meraki Bespoke Wellness Strategies.