The Grand Summit Hotel is poised to complete two long awaited renovation projects. o Earlier this year the Crown Club received its first-ever upgrade since opening day in 1992. The response from owners has been tremendously positive, and the renovated Crown Club has really added to fun time with family and friends. This project is now complete. o It’s finally time for room renovations! This winter a Model Room was completed and visited by hundreds of owners, delivering valuable guidance on the complete renovation of all 230 rooms in the hotel. The next step on this exciting project is now before us!
These major room renovations will include an incredible collection of upgrades and modernizations, including: o A brand-new kitchen, including a 4-burner stovetop, oven, and full-sized refrigerator in all units, making food preparation and longer stays easier o New modern furniture, wall mounted TVs, and new lighting o New Murphy Beds and sleeper sofas o New mattresses on all beds o New light-filtering and room-darkening shades o New bathroom vanities, including storage cabinets and shelves, new mirrors, and new lighting o New interior doors and deck doors o New small deck table and deck chairs, replacing the white plastic chairs o Room safes
Will the new TV’s be Smart TV’S? o Yes, meaning they will be internet-connected and capable of streaming and casting your favorite apps, like Netflix, Hulu, etc. These new televisions will not be the same type of SMART TV as you would purchase for your home, but they will have the capacity to do the same tasks (and even more). We will purchase commercial televisions, which will allow us to use a third-party platform like Sonifi for you to connect to all of your streaming services. The current televisions were purchased about 15 years ago and are not compatible with this third-party solution. Sonifi is widely used in the hospitality industry and allows guests and owners the ability to log in to their personal streaming services. Guests are automatically logged out of the system at check out, providing a safe and secure experience.
Will the smaller appliances and other in room items be replaced? o Smaller items in the room such as linens, small appliances, dishes, etc. are already replaced frequently by the Maintenance Reserve Fund which both Sunday River and the ownership contribute to. Anytime a housekeeper finds a broken, stained, torn, etc. item in a room they replace it. In addition to replacing items that are damaged or soiled, we replace the entire “fleet” of items in the hotel every 3-5 years, on average. o We also often replace items with a new spec to upgrade to a better or newer item that will help enhance the in-room experience. Some of the items we have recently replaced with a different spec throughout the entire hotel are wine glasses, coffee mugs, coffee makers, clock radios, towels, mattress pads, plates/bowls, and soap dishes. o We are also frequently looking at items to add based on requests from guests and owners. Knife blocks are next on our list. o A few of these items are slated to be replaced with the renovation in order to have them be appropriate for the new design. Telephones, bathroom accessories, and trash/recycling bins will be part of the room renovation, just to name a few.
How it works in other hotels – and are we on track or overdue for complete room renovations? o The short answer is we are long overdue. o The industry standard for room renovation is 7-10 years, yet many of the elements in the Grand Summit rooms have not been updated in 31 years.
Impact of age of room on popularity and reservations o The #1 comment we receive from hotel guests is that the rooms are outdated, and tired. This impacts online reviews and guest ranking in terms of rate of return. o We now have an opportunity to create a resort hotel where owners can enjoy modern fixtures and furnishings, new heating and cooling systems, and new doors while the stature and reputation of the Grand Summit can grow among guests across our own resort, ski resorts in our area, region, and around the country.
Impact of renovations on how much the hotel can charge for rooms and therefore how much owners will receive in rental income o Owners who place some of their 13 weeks into the rental pool have already seen rental income increase, in some cases up to 100%. This is due in large part to renovation of common area spaces, as well as Sunday River’s investment in CAMP, renovation of the Grand Ballroom, etc. o In similar renovations at Boyne-managed properties, there have been increases in average daily room rate and price per available room. This translates to more rental income for owners after the renovations are complete.
Financing plan o Skowhegan Savings Bank has agreed to loan the Association 80% of the project cost, which will be paid back over 10.5 years. o The remaining 20% will be paid for by a one-time lump sum assessment. Information on the amount of each owner’s portion is available on the Owners Website. If you don’t have a login/password or don’t know where to find the information, please email email@example.com.
Overall cost and cost by owner o The overall budget for the full renovation of 230 rooms, including all of the items listed in #2 above will not exceed $15,000,000. o Detailed information about amount of one-time lump sum payment and payback of loan are on the Owners Website (Annual Meeting Section) and available by emailing firstname.lastname@example.org.
Due date for special assessment: o Invoices will be sent July 15 and due by September 30, 2023. o Owners with special circumstances, who need 90 days to pay, can contact email@example.com when they receive their invoice.
Final decision and vote o The HOA Board has unanimously approved this project and recommended it to the ownership at large. o Each owner has an opportunity to vote on the plan, and the plan requires approval by a majority of unit owners. Each deeded unit will get one vote, and there are 676 deeds (if you own one deeded unit, you get one vote. If you own three deeded units, you get three votes, etc.) o Learn how to vote.
Sunday River as the rental agent receives 45% of room rental income – here’s what it pays for: o The entire process of recruiting, hiring, training and housing housekeeping team members in addition to training and developing their leaders and 100% of the supplies related to a rental management guest o Portion of VP of Lodging and General Manager o Larger Sunday River leadership team and Boyne corporate team– Resort COO, President of SR, SVP of Lodging, VP of Revenue Development, SVP of Food and Beverage, etc. o Front Desk staffing (HOA pays a portion based on owner occupancy) for guest visits o Revenue Management team members and revenue management program, Duetto – Hotel revenue management software & solutions – Duetto (duettocloud.com) o Reservations team, call center software and recently added CRM software Salesforce (Customer Relationship Management) – all of which have a significant expense o Marketing team including website design, email marketing, etc. o Sales Team, sales event attendance and sales programs o Group Service team to assist group business while onsite and deliver personalized services o Alice – operations and guest communication tool o Guest survey software tool that helps track guest satisfaction and improve guest retention o Property Management Software and online booking tool o Boyne Vacation Club o Boyne Rewards Program o Special owner events – all of which have a cost
Who is overseeing this project? o The HOA Executive Board researched, interviewed, and assembled a room renovation project team with the experience to successfully complete the full-scale project. o The project team, consisting of a professional construction project manager, lead construction company, interior design team, Board members, and Sunday River staff meet regularly and will continue to do so throughout the duration of the construction.
Do we have a professional project manager? o Yes. The Project Manager representing the Summit Condo Owners Assn., is HEC+A and HE Callahan, based in Auburn, Maine, they have decades of commercial Project Management experience. Their role on the project team is to coordinate all parties and advocate for the best interests of the Summit Condo Owners Assn.
Who is the contractor for the renovation? o DEW Construction has been hired to complete the construction work on the Model Room. DEW is a New England based commercial firm specializing in construction management and general contracting services. They have decades of experience in the hotel industry and ski industry.
The team the Board has hired has over 100 years of combined experience in renovation and has been working hard to make progress towards renovating all 230 rooms of the hotel.
Who designed the room renovations? o The design work for the Model Room has been completed by Christine Burdick Design, a Northern New England based commercial design firm that pulls inspiration from the natural landscape. The Burdick team is very familiar with the Grand Summit Hotel, having designed and executed the renovation of the common areas including guest hallways, lobbies and the Owners Lounge. They also completed Sunday River’s renovation of the Grand Ballroom.
Other options were considered:
(1) 15.5 year loan: Extends payback and lowers quarterly payments but results in higher overall cost due to five more years of interest, at a cost of $2,836,153.
(2) Phase the project by location, e.g. one wing at a time: Higher overall project cost due to fewer economies of scale; higher costs of labor and materials as time goes on; hotel “under construction” for extended period; unequal cost and benefit to owners, depending on room location.
(3) Phase the project by scope: Reduced benefits to owners and guests and less increase in property appeal; current project has something for everyone, cherry picking of upgrades would be required, and higher overall project cost due to inflation.
(4) Not financing through a loan but through a one-time special assessment: Eliminates interest paid; but places burden of higher upfront/short-term cost on owners.
(5) Wait for the Jordan to renovate and see what the benefit is to their association/property/rental income: Lost time; lost opportunity to advance Summit brand at the resort; further degradation of existing rooms.
Performance guaranty/penalties o The Grand Summit renovation project will be successful because we have selected an experienced Construction Manager (CM), and a skilled and experienced General Contractor (DEW) that handles developments throughout New England. Due to this type of project delivery method, DEW places a premium on what they believe they can build the project for and within a specified amount of time. o The controlling document will be known as a CM Agreement that comes with a GMP. There is no indication of Liquidated Damages (or penalties) as the CM assumes all risk in controlling time, cost, and quality. With this type of project delivery, (versus design – bid – build for example) the CM establishes a GMP, a commitment by the CM to deliver the project within a defined price and timeframe based on the information identified in the design documents. o This type of contract is commonly known as an “open book” contract, where the owner and the CM work together during the “buyout” process to obtain the best pricing. The budget is based on industry experience, but if material costs go up between now and the buyout, there could be some changes in pricing, but is generally covered by a contingency reserve. If the prices go down, the savings are split between the CM and the owner and applied to future contingency items for “unforeseen” conditions. In the current construction climate, post COVID-19, this type of contract has been accepted in the industry as a best practice to manage cost.
Know Before You Vote o The Grand Summit room renovation project will transform the hotel and its value to owners, both financially and in the quality of experience. It’s a big and important decision, so if you have any questions or hesitations, please be in touch. We want everyone to be confident that you ‘Know Before You Vote’. Please join us for one of our Information Sessions to hear more and ask questions!