From reducing construction costs, speed to market, addressing labor shortages, meeting brand expectations and being environmentally conscious, sustainable sourcing is changing business development in hospitality. In addition to using green building materials, developers are increasingly turning to modular and prefabricated off-site construction to save time, waste, labor and money. Overall, they are evaluating products for their efficiency and long-term usefulness.
Sustainable Sourcing in Practice: Changing Priorities
According to at least one developer, the definition of sustainability has morphed over the years. “Sustainability isn’t what it was 10 years ago. Then, I would have said it was about the actual source of materials, such as selecting bamboo instead of hardware or selecting cultured surfaces in lieu of exotic stones imported from around the word. Then, the focus was on simplicity and replenishment of the resources. These days, I think sustainability is market-driven and more about efficiency in transportation and sourcing. It’s about the life cycle and sustainable sourcing of materials, not from a growth or regenerative standpoint, but more about the security of your supply chain,” said Kevin Warwick, vice president of design and construction with Vision Hospitality Group.
As an example of efficiency in sourcing, Warwick said that it is important to build lasting relationships directly with sources, both domestically and abroad, which is the key to insuring the best pricing and security of the supply chain. “We want direct relationships versus going through brokers and vendors, which gives us the best chance of meeting the projects’ needs and an efficient delivery method,” he added.
Mitch Patel, founder & CEO, Vision Hospitality Group, said, “The greatest returns come from smarter design, efficient building layouts, durable materials, domestic sourcing when practical and direct relationships with manufacturers. These strategies reduce waste, improve reliability and create long term value.”
Mike Rimmington, senior vice president and head of hospitality at Vingcard, a hospitality technology provider, also pointed to shifting priorities in sustainable sourcing, with owners more concerned about “… lifecycle impact, energy performance, material transparency, recyclability, packaging, battery use, system interoperability and long-term maintenance requirements. They also want to understand whether a technology can support green building goals, reduce energy use through automation and integrate with existing property systems. A few years ago, many conversations focused mainly on functionality. Those priorities remain important, but owners are also considering how each technology affects efficiency, operating cost and sustainability performance to make their final decision.”
Sustainable sourcing isn't just about what a hotel buys. Rather, it's about designing and operating a building in ways that reduce environmental impact while creating a healthier experience for guests and the decisions need to start at the design and construction phase, said Mike Jolly, SVP of entitlement and construction with EKN Construction.
Lifespan of Products as a Barometer of Efficiency
When choosing materials for a new hotel and making sourcing decisions, the useful lifespan of the products and efficient design is on developers’ minds. Utilizing what Warwick calls timeless products is especially noteworthy, as hotel brands often require renovations in shorter fixed cycles, but many brands are able to extend those renovation cycles from 7/14/21 years to 10/20/30 years. For example, a decorative wall sconce, which costs less initially, must be replaced every seven or so years, resulting in more labor, more materials and more waste. But a recessed LED, which costs more upfront, will last for 20-30 years. Thus, said Warwick, this is an example of “… thoughtful, efficient design geared around useful life.” Another product he pointed to as example of efficient materials is using LVP planks versus carpet, as LVPs can last 14-21 years, while a carpet is less durable and only lasts seven to 10 years.
Along the same lines, Rimmington said that there has been a shift from individual products to integrated systems: how the building performs as a whole, which affects long-term performance. "Sustainability has changed sourcing by encouraging hotel owners to look beyond the manufacturing impact of individual products and consider how building technologies can work together to support sustainability initiatives across the property,” he said.
The end goal, of course, for sustainable construction methods and materials is to reduce ongoing operating costs in the long run. Thus, smarter sourcing decisions lead to measurable ROI, and deliver environmental benefits.
“The easy wins are LED lighting, low-flush toilets and efficient showers, but the biggest impact comes from investing in higher-efficiency mechanical systems. The sustainability decisions that deliver the strongest returns are often behind the walls: HVAC, water systems and mechanical technologies that improve efficiency for the entire life of the asset,” said Warwick.
Modular and Prefabricated Construction: Efficiency, Speed-to-Market, Cost-Saving, and Labor-Saving
Hotels are the ideal candidates for modular (sections of hotels built in a factory offsite) or prefabricated (individual components built and assembled offsite) construction, as hotels are pretty standardized.
RISE Modular specializes in volumetric modular production, in which entire hotel rooms are built in a factory offsite; the modules often even include FF&E. Hotel construction usually operates on tight deadlines, so one major advantage to modular construction is the time efficiency, said Ned Dodington, AIA, vice president business strategy. “The high degree of repetition in hotel guestrooms lends itself to modular execution. When you have standardized units and designs, they can be repeatedly executed within a factory setting,” added Dodington.
Dodington said that modular can reduce the overall construction schedule by 30-50 percent, as an industry rule of thumb, particularly as the site work is happening in tandem with factory production. If modular construction shortens a project by four to six months, the owner also saves substantial financing costs and the hotel can open more quickly.
Also, by prefabricating as many building components as possible in advance, that approach addresses the expense of labor, important for many developers as construction and operating costs have risen in recent years. As much of the labor takes place in the factory, modular helps reduce labor costs at the job site.
As Warwick has mentioned, efficiency aligns with sustainability and few construction methods are efficient as modular/prefab. Dodington echoed this, noting that even using ordinary materials more efficiently is a hallmark of sustainability. "The bigger environmental impacts aren't necessarily in the material selection; they're in the efficient use of traditional materials,” said Dodington, adding that a factory setting allows for a more efficient use of materials while producing less waste.
Some challenges to integration of components like locks revolves around coordination, so technology requirements should be addressed early. “Modular construction compresses many decisions that would traditionally happen in stages, so door specifications, access control systems, room controls, HVAC integration, lighting, sensors, network connectivity and operational platforms all need to be aligned earlier. If these details are not addressed before fabrication, developers can face delays, additional work or added costs once the modules arrive onsite,” said Rimmington.
Beyond Up-Front Cost: Environmental and Other Benefits
The initial purchase price of sourcing building materials is only one part of the cost conversation; however, ‘sustainability’ does not always cost more. “Sustainable sourcing can lower long-term operating costs when owners evaluate technology based on total lifecycle value rather than upfront cost alone. Owners can also experience savings from these types of solutions from reduced maintenance, longer product life and easier upgrades. Higher performance technology may sometimes cost more initially, but it can deliver stronger value when it reduces energy waste, labor demands and replacement needs over time,” said Rimmington.
In addition to the short-term benefits, long-term asset performance is relevant to the conversation. A consistent product combined with the fact that modules are built indoors and are insulated from unfavorable weather conditions, modular can improve long-term quality and reduce warranty defects over time, said Dodington.
Another example of a favorable long-term and cost-effective benefit to sustainable sourcing is low-carbon concrete. Because concrete production, particularly Portland cement manufacturing, is a significant source of greenhouse gas emissions, Jolly said one way to reduce embodied carbon is by injecting captured carbon dioxide into fresh concrete during the manufacturing process.
In addition to environmental benefits, which is an important value for many companies, many of these sustainable sourcing decisions will also benefit the guest experience. For example, Jolly pointed to smart rooms that sense when a person is or is not occupying the room and will adjust the HVAC system accordingly. This, plus installing high-performance windows, improve both efficiency and the guests’ comfort level.
What’s Ahead
In the future, the biggest sustainability advancements will come from buildings operating more efficiently and from green materials lasting longer; the two go hand-in-hand.
“Nearly every industry has been transformed by innovation, yet construction has changed far less than most. We need to rethink how we build. Modular and prefabricated construction, along with AI, will become increasingly important because they improve quality, reduce labor needs, shorten construction schedules and accelerate time to market,” said Patel.
Patel added that the future of hotel development is about building smarter. “More efficient designs, longer lasting materials, resilient domestic supply chains, modular construction and AI will all play a larger role. The developers who succeed will be those who continuously improve efficiency while delivering exceptional guest experiences and long-term value for their owners,” said Patel.
A Case Study in Sustainable Sourcing and Modular Construction
Recently, Koucar Management developed a Cambria Hotel in O’Fallon, Missouri, utilizing modular construction, partnering with RISE Modular. Geo Babu, project manager, estimated that there was a reduction in build time by about 50 percent, and this was despite significant rain. As the components of the hotel were built indoors in a controlled facility, the project was protected from weather disruptions. “This parallel construction process allowed foundation work, utility installation and other site preparation to continue while the modules were being completed off-site. Once the site was ready, the finished modules could be delivered and installed quickly, reducing the amount of weather-sensitive work required on-site,” said Babu.
The project utilized recycled and responsibly sourced materials, and low-emitting finishes, such as engineered wood products, low-VOC paint and adhesives and fixtures were selected for durability. “We also prioritized materials that could withstand frequent hotel use, since longer-lasting products reduce replacement needs and waste over the building’s life cycle,” said Babu.
The most significant savings, said Babu, came from schedule reduction, labor efficiency and improved material control. “We also saw savings from the repetitive nature of the guestroom design. Materials could be purchased in larger quantities, installation was more consistent and the controlled factory environment helped reduce waste, weather damage, rework and punch-list items. The higher costs were generally concentrated in transportation, module delivery, crane installation, factory coordination and the additional design and engineering required early in the process.”
As the need for labor was significantly reduced on-site, it allowed the team to shift their attention to a more controlled and efficient manufacturing environment and reduced the need to have every tradesperson available on site at the same time. “We still needed skilled coordination for delivery, crane installation, utility tie-ins, fire-stopping, weatherproofing and final finishes, but the overall on-site workforce was smaller and required for a shorter period. From a development perspective, that helped reduce scheduling risk, improve productivity and lessen the project’s exposure to local labor availability,” said Babu.
One challenge was that decisions had to be made earlier in the process than in a traditional build, as late changes could affect the factory production schedule. Still, he is considering modular design for future development projects, particularly as modular construction improved long-term maintenance expectations due to the consistency and quality of materials used. “Modular construction doesn’t remove the need for maintenance, but it creates a more consistent and predictable environment for long-term operations. We do expect the potential for lower maintenance costs over time, particularly if the factory-built components perform as intended and the standardized materials are durable and easy to replace.”
For those considering building hotels using modular construction, Babu said, “Owners should evaluate modular based on the total project value, not only the cost of the guestroom modules. The greatest benefits may come from schedule certainty, reduced on-site labor, consistent quality, lower weather exposure and the ability to open the hotel sooner. With the right project, team and upfront planning, modular can be a very effective development strategy.”
This article was originally published in the August/September edition of Hotel Management magazine. Subscribe here.