Session 5

1. Session 5 Topic 5 Feasibility and Design Of Physical Assets

3. Today’s Topics • Some background • “Facility” and / or “Facilities” • The Facility Manager • The facility process • Feasibility • Design • Some buildings • The link to managing risk

4. Background& the jargon 1 (2) • Facility • The building itself? • Entity - a legal term • A place where services / goods are created / sold? • Facilities • what’s available for use within the building? • Customers / public / staff • “the premises and services required to accommodate and facilitate the business activity” (Langston & Lauge-Kristensen, 2002 p3)

5. Background & the jargon 2 (2) • Facility Management • aligning infrastructure to strategic intentions of the organisation • PMS - the property management system?? • ERP - enterprise resource planning • merging HR with facilities using interconnecting databases and management practices • increasing productivity through a better environment • Spatial, organisational, financial, technological • a holistic view of the workplace & workspace

6. The Facilities Manager 1 (3) [Langston & Lauge-Kristensen, 2002, p6] • More than “the maintenance man” • A new concept for hotel / hospitality operations • previously done by several management staff - at an operational level • engineering / rooms division • tended to be reactive rather than proactive So what does the modern FM need to be able to do??

7. The Facilities Manager 2 (3)[Langston & Lauge-Kristensen, 2002, p6] • The FM needs to be able to: • see the Big picture • understand both facilities and customers • undertake financial analysis • measure facility performance • objectively evaluate best options for facility customers • be flexible and able to make radical changes • be innovative

8. The Facilities Manager 3 (3) • The FM really needs as many of the following competencies: • Strategic management • Space management • Information management • Risk management** • HR management • Financial management • Operations / maintenance management • Real estate management • Project management • Asset management • Quality assurance / management • Conflict management

9. The process of facilities • Feasibility study / Needs analysis • (re)Design • (re)Construction • Deliverables • Management of Operations • Maintenance • Obsolescence / refurbishment • Sale

10. Feasibility: background & objectives • The fundamental question for any feasibility study: • is the project practical, possible, doable? • looking for a positive outcome • Feasibility / appraisal / evaluation?? • Objectives: • Information regarding the environment • Potential risks: political / commercial / environmental / building-related • Brief for the architect - market forces • Investment information - lenders / investors • Liaison with planning authorities • Negotiation with management companies • Hotel companies

11. Feasibility: the process • The feasibility process covers: • Site appraisal • Market research • Information review • Financial analysis* • Income projections* • Reporting • and can be used for: • New built facility • An acquisition • Extension / addition to current facility • Major refurbishment • Major renovation - moves the business to a new target market

12. Feasibility: site & market research • Site appraisal • Size / positioning / access • Visibility / demand generators • Other facilities & services • Competitors (see Las Vegas) • Site SWOT analysis • strengths / weaknesses / opportunities / threats • Market research • Economic data / demographics / transport & infrastructure • Competition - now and in the future • Legislation & regulations • Labour availability - costs of operations

13. Feasibility: Information review • Information review • The basis for project management practices • Examine the collected information • Utilise experts within the project team • Consult widely • Internal - within the project company • Externally experts in other sectors benchmarking • Information management • Documentation and dissemination

14. Feasibility: Financials & Reporting • Financial analysis & Income projections • Volume - occupancy • Market acceptance & penetration • Location / features / services offered / new-old? • Other income producing services • F&B / conferencing / health centre / /telephone / ancillary services • Price and volume • Linking occupancy to rates / Resilience of the market • Costs • How much will it cost to “DO” the project • Income projections • Usually more than GOP / NP / ROI • Reporting • The final phase • Dissemination of decisions / judgments

15. Design some buildings & design issues

16. Design • “Perhaps the most basic difficulty for the neophyte hotel designer is learning that hotel operations must earn a profit out of its building. In a hotel, you are both leasing to the public every night and catering to their every need. Therefore, rather than a monument of mere rental space, a hotel must provide a total living environment, with all the needed multicomplex functions and activities”

17. Design • Design? • Design = Form + Function • From vision to reality • Drawings, planning, operations • Developing the building and facilities to meet changing customer needs / trends • The design process • Concept • Design brief • Costing • Detailed design • Tenders • Implementation

18. Design cont… • Why bother with design?? • Marketing reasons • Ambience • Operations • Maintenance • Capital costs • Whole-of-building design • Environmentally sustainable buildings / design

19. Design cont.. • Some elements of design • Single use facility • the hotel / office / serviced apartments • Flexibility of use • Change to accommodation / seating / capacity • Incorporate new trends (Internet / wireless technologies) • Sensory design issues • Lighting / Sound / Colours / Soft furnishing • Interior • Best practice for front & back of house • Guests / public / staff • Exterior • Best presentation of the hotel as a building • Landscaping / signage / lighting / entrance • Minimal maintenance: extended lifespan of products • Passive building (natural heat / cool / air flow)

20. Design cont.. • Factors affecting design • Corporate objectives / policy • Concept - ideas / market orientation • Location • Function - capacity / space utilisation • Aesthetics - style / character / integration • Budget / costs • Organisation - strategies / life cycle • Logistics - critical dates / contractors • Type of building - heritage listed?

21. Technology & Design • Technology in materials • Use of pre-fabricated elements in building • Less risk (fire / water / redundancy) • CAFM / CIFM / CAD • Computer-aided FM • Computer-integrated FM • Computer-aided design • Integrating the workspace with building design • Impact on both staff and guests • CMMS • Computerised maintenance management systems • Linking the building with the organisation’s systems

22. Tutorial activity • Define the two concepts ‘Market Feasibility Study’ and ‘Financial Feasibility Study’. Why is it suggested that a hotel developer conducts both before attempting to purchase suitable real estate for the planned facility? • How will the design of the property impact down the line on the condition and management of the facility? Think of a property you have worked in or visited – perhaps there are some design flaws that have even created inherent risks!