Great Fosters in Egham is to embark on an expansion programme to ensure the longevity of the hotel and ‘make the model work’.
The luxury 43-bedroom property in Surrey, which last year turned over £7.2m, is to begin construction on six new bedrooms and a gym in September, which will kickstart a series of new developments at the hotel.
Managing director Richard Young, who has worked at the business for the past two decades, told Boutique Hotelier that currently the hotel’s business model is ‘wrong’ and needs to be addressed, with income split 70% F&B and 30% bedrooms.
Once new bedrooms are built, then corporate midweek rates can build and yield can increase throughout the week, he says.
“We’ve been very successful in building lots of things,” Young tells BH, “but what I haven’t been successful in doing is persuading the shareholders to borrow some more money and build these extra rooms and then the model will work.
“It’s at a point where the standards are there, it just needs more bedrooms to make the money. The model is wrong at the moment.”
This first new development will help to ‘test the waters’ for future expansion, with another 25 bedrooms being considered and a plan to grow the hotel’s F&B’s offering to accommodate the increase in capacity.
The hotel is currently home to the Estate Grill brasserie and Tudor Room Michelin star restaurant.
Great Fosters is owned by the Sutcliffe family, with Young worked with a total of 17 shareholders to see ideas through to fruition.
“It’s become a very hard business,” says Young, “maybe not so much to grow the top line, you can be innovative, have different projects, but any business that isn’t looking forward and into expansion and adding more bedrooms, is going to get left behind, they won’t be able to exist.”