Size matters, but scarcity matters more.
SIZE MATTERS, BUT SCARCITY MATTERS MORE Interesting analysis on fixed costs and profitability thresholds. I’d add a nuance from experience: I once saw a 179-room hotel (outside the Eurozone) generating €4M in revenue with poor EBITDA—despite the size advantage. Overly standardized, commoditized approach. The same potential owner-investor was offered by EXUPERE a 42-key boutique hotel, same €4M revenue, but strong EBITDA. His reaction? “How can 40 rooms match 179?”
The answer: SCARCITY
Small hotels can offset structural disadvantages through distinctive positioning and premium pricing justified by exclusivity. When you create desirability, you transcend fixed-cost dilution logic.
Yes, size matters. But differentiation and perceived value matter more. Plus, location is never innocent.
Hotels with fewer than 50 rooms are gems—the very ones major groups try to emulate as they diversify. Small can be beautiful—if rare and desirable.
#HospitalityInvestment #BoutiqueHotels #HotelProfitability #LuxuryHospitality EXUPERE
