Case Study 2

Overview

BGS professionals’ experience includes the development of innovative investment strategies for family offices that seek stable, high-return investments in the hospitality sector. The proven strategy focuses on acquiring and revitalizing independent hotels in both the US and Europe.

BGS’ hospitality experience includes identifying and working with hotels operating below potential due to a lack of capital and modern marketing techniques. Through a fresh infusion of funds our hotel partners were able to make much-needed property improvements and enhance marketing efforts. This approach not only improved revenue for the hotels but also provided a reliable source of recurring income for BGS family office clients.

The challenge

Family offices often seek investment opportunities that provide steady returns while balancing risk, particularly in the current climate where traditional investment avenues are more volatile. However, independent hotels in prime locations often struggle to access the capital needed for renovations and modern marketing. Key challenges included:

Capital Constraints: Many independent hotels had aging infrastructure and outdated amenities, which reduced their competitiveness in the market.

Ineffective Marketing: Lacking access to digital marketing expertise, these hotels were missing out on opportunities to attract a broader clientele, especially as consumer preferences shifted toward boutique and experiential stays.

Underutilized Revenue Potential: Despite strong locations, the hotels were unable to maximize revenue due to operational inefficiencies and outdated revenue management systems.

Approach

BGS professionals designed a comprehensive strategy to address these challenges, involving targeted investments in select independent hotels with high growth potential. By facilitating capital improvements and introducing modern marketing techniques, BGS professionals enabled these hotels to enhance their competitiveness, grow revenue, and deliver a strong return on investment for family offices.

Targeted Acquisition and Capital Infusion : BGS professionals identified independent hotels in the US and Europe that were located in key travel destinations but underperforming due to capital constraints. Working with family office clients, BGS facilitated investments that provided the necessary funding for property upgrades, including renovations to guest rooms, common areas, and amenities. These capital improvements enabled the hotels to compete with larger, branded chains while maintaining their unique charm and appeal.

Modernizing Marketing and Revenue Management: In addition to capital improvements, BGS worked with hotel management teams to implement modern digital marketing strategies. This included optimizing online booking platforms, leveraging social media to attract new customer segments, and employing data-driven revenue management techniques. The integration of these technologies helped the hotels increase occupancy rates, improve pricing strategies, and enhance their visibility in competitive markets.

Operational Efficiency Improvements: BGS also introduced operational efficiencies to the hotels, such as upgrading property management systems and introducing energy-saving technologies. These changes reduced operational costs and allowed the hotels to allocate more resources toward guest services, further enhancing customer satisfaction and loyalty.

Results

Through this targeted investment strategy, BGS professionals were able to generate substantial returns for family office clients while simultaneously revitalizing independent hotels and helping them thrive in competitive markets

Capital improvements and enhanced marketing efforts led to an average 25% increase in annual revenue across the portfolio of independent hotels, with significant growth in both occupancy rates and average daily rates (ADR).

Increase in revenue**

The improved performance of these hotels provided a reliable source of recurring income for family office investors, diversifying their portfolios and delivering consistent cash flow over time.

Recurring income stream

The adoption of modern digital marketing strategies and optimized booking platforms resulted in a 40% increase in the hotels’ online presence, leading to higher direct bookings and reduced reliance on third-party booking platforms.

Improvement in online visibility

The capital improvements and increased revenue performance also led to a substantial appreciation in the value of the hotel properties, giving family offices additional upside through property sales or refinancing opportunities.

Higher property valuations

Conclusion

BGS’ experience showcases our innovative approach to investing that has enabled family office clients to capitalize on unique opportunities in the hospitality sector. By combining targeted capital improvements with advanced marketing and operational strategies, BGS not only revitalized these properties but also created a source of sustainable, recurring income for its clients. This strategy highlights BGS’s ability to unlock hidden value in mid-market opportunities and deliver strong financial outcomes for its family office partners.