If You Own Property, You Can Triple Your Earnings By Turning It Into A Hotel
Diane Goldsberg had been managing an apartment rental business in Taguig City for several years when representatives of a startup company approached her about a new enterprise. ReddDoorz is a hospitality platform that manages branded hotels in emerging cities. They offered Goldsberg the chance to turn her apartment building into a 30-room hotel, promising her an uptick in revenues.
“They talked to me in May (2018) and I thought it was a good proposal,” Goldsberg said in an interview. “They took over management and operations of the hotel, and within one month, we opened RedDoorz Hotel.”
Goldsberg said that with her rental business, she was earning just enough to pay the bills. She needed a challenge and an increase in profits, which was why she grabbed the opportunity RedDoorz gave her. Although she declined to give exact figures, she said there’s no denying the improvement in her business.
“My earnings tripled after RedDoorz came in,” she said.
Founded in 2015 in Indonesia, RedDoorz calls itself a tech-enabled accommodations company riding the wave of the sharing economy. It manages a network of properties without directly owning any of them. Just like its partnership with Goldsberg, the company turns local boutique hotels, inns, apartels, condotels and other privately owned accommodations into standardized hotels with basic service amenities. The promise is to offer guests the same level of service at all of its locations.
“As of the first quarter of 2019, we have about 680 hotels in 40 cities in four countries,” RedDoorz COO Rishabh Singhi said during a briefing at a RedDoorz Hotel in Quezon City. “Currently we have about 2,500 rooms. The target is to increase it to 7,500 rooms by yearend.”
Singhi said they’ve signed up over 100 properties in the Philippines—in Metro Manila, Cebu, Davao, Pampanga and Tagaytay—and are targeting to double them to more than 250 properties this year.
“We’re trying to solve the problem of this unnamed, unbranded, small mom-and-pop hotel, and there are lots of them,” Singhi said. “We are solving the problem for them, trying to give them the brand, technlogy and training.”
Besides targeting accommodation-seekers, RedDoorz’s expansion plans involve attracting property owners to partner with them. Singhi said the main come-on is the chance for partners to increase the visibiity of their property through RedDoorz’s online booking platform. The company also manages demand and adjusts pricing accordingly, ensuring maximum revenue potential for property owners.
“These hotels normally operate very low-tech, whereas RedDoorz operates on a high-tech platform,” Singhi said. “Our technology saves them a lot of time, plus if they were to buy this type of technology that’s out on the market, it would be out of reach for them. So they get access to this technology and the training on how to use them.”
Singhi said the average revenue split between property owners and RedDoorz is 80-20 on gross sales.
In addition, the company also provides property managers and their staff with training to further improve their hospitality skills.
For property owners who are looking for more excitement in their business and add to their bottom line, RedDoorz is an option worth considering.