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Negotiating long-term rates at luxury hotels

Negotiating long-term rates at luxury hotels

Old Jun 19, 20, 12:08 am
  #1  
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Question Negotiating long-term rates at luxury hotels

I tend to travel slowly, staying in a given city for at least a month at a time. As a result, I typically stay in serviced apartments at favorable rates. For the sake of convenience and consistency (and the prospect of earning hotel points/status), I would like to begin using hotels instead.

Does anyone have experience getting discounted monthly rates from luxury hotels?

There are several threads on FlyerTalk regarding full-time hotel life which suggest negotiating rates with the hotel (manager? owner? corporation?) directly, but they don't give an idea of what percentage to aim for. How much more expensive should a luxury hotel to be in comparison to a luxury serviced apartment? Or are they the same, where staying in a hotel means exchanging the spaciousness of an apartment for the convenience and service of a hotel?

I have also heard of Virtuoso agents being helpful in booking hotels. Is negotiating a monthly rate something they would be able to take care of?

Are there any established brands (Four Seasons, Peninsula, etc) that are particularly amenable to long-term stays, or that have standard practices regarding long-term rates?

Thank you in advance for any experience, anecdotes, or advice you may be willing to share.
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Old Jun 19, 20, 2:53 am
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In most luxury hotels, you get a better price for extended stays - usually this is 10-30% less than the standard rate. It is best to travel in the low season. Then it can also be 50% of the regular price. It depends on what you plan for a budget per night. For anything over 250 USD, you can also consult a Virtuoso agent. Agents will get you a better price than you can as they mainly know the people in the hotels personally.
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Old Jun 19, 20, 4:53 am
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You didnít mention how long your stats are. In my experience you can expect approx 25% off when staying for one month +. You can negotiate some other benefits like 25% off F&B and up to 50% off laundry.
The longer your stay, the greater the discount achievable. Another negotiation factor can be prepayment, if you prepay 100% of your stay, the hotel will be more flexible to provide a discount since they will always be concerned about an early check-out before the agreed length of stay.
Negotiation can be started at the reservations office contact and then you can push to escalate up all the way to GM level.
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Old Jun 19, 20, 8:57 am
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Iíd curious if you are better off directly approaching someone like the director of sales, versus going through an agent. Not having to pay commissions (~10%) vs no existing relationship. I suppose if the TA really knows the sales team, you are better with that approach, otherwise go directly.
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Old Jun 19, 20, 10:19 am
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FellPaisleyWrack Yes, Virtuoso Advisor can negotiate long term rentals/stays. And depending the property, some are designed with this in mind.
For example, just this week, I negotiated a month long stay for a client at Rosewood Mayakoba at a substantially discounted rate.
Last week, I negotiated a similar deal at an Aman for a client for an extended stay.
Dorado Beach is publicly offering discounted long term stay deals. Discounts for stays between 14 nights - 60 nights or more and the discounts increases along with the duration.

In December, I booked myself a nearly month long stay at Rosewood Hong Kong's longer term Residence which is like service apartments but obviously a different league, entirely.
The value was very good vs. booking a suite on the hotel side.

I think you'll be surprised in the value you may be able to find. But like all things in this space, it can vary widely between properties.
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Old Jun 19, 20, 1:22 pm
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If youíre looking to gain night credit or points in a rewards program, make sure you are asking for an extended-stay rate that will still allow you to earn. Sometimes, a special ďmanagerĒ rate is ineligible because itís a deeply discounted rate.
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Old Jun 19, 20, 9:36 pm
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Thank you for your replies.

Originally Posted by Privateupgrades View Post
In most luxury hotels, you get a better price for extended stays - usually this is 10-30% less than the standard rate. It is best to travel in the low season. Then it can also be 50% of the regular price. It depends on what you plan for a budget per night. For anything over 250 USD, you can also consult a Virtuoso agent. Agents will get you a better price than you can as they mainly know the people in the hotels personally.
I must confess that I am rather surprised that the discount can be as low as 10%. Are hotel occupancy rates generally that high? I tend to stay in less expensive cities, such as Kuala Lumpur and Bangkok, where my budget is around $4,500 per month for a studio.

Originally Posted by NikonDuser View Post
You didnít mention how long your stats are. In my experience you can expect approx 25% off when staying for one month +. You can negotiate some other benefits like 25% off F&B and up to 50% off laundry.
The longer your stay, the greater the discount achievable. Another negotiation factor can be prepayment, if you prepay 100% of your stay, the hotel will be more flexible to provide a discount since they will always be concerned about an early check-out before the agreed length of stay.
Negotiation can be started at the reservations office contact and then you can push to escalate up all the way to GM level.
I typically stay one to two months at a time, though I am considering living in hotels full time. I am willing to prepay for stays of up to several months in length. In your experience, does that allow for a discount greater than 25%? Is there generally a contract with prepayment, or is there still the danger of being walked if a more lucrative customer comes along?

Originally Posted by Cityflyer10 View Post
Iíd curious if you are better off directly approaching someone like the director of sales, versus going through an agent. Not having to pay commissions (~10%) vs no existing relationship. I suppose if the TA really knows the sales team, you are better with that approach, otherwise go directly.
Thank you for the advice; I didn't realize commisions were so large.

Originally Posted by BESVISOR View Post
FellPaisleyWrack Yes, Virtuoso Advisor can negotiate long term rentals/stays. And depending the property, some are designed with this in mind.
For example, just this week, I negotiated a month long stay for a client at Rosewood Mayakoba at a substantially discounted rate.
Last week, I negotiated a similar deal at an Aman for a client for an extended stay.
Dorado Beach is publicly offering discounted long term stay deals. Discounts for stays between 14 nights - 60 nights or more and the discounts increases along with the duration.

In December, I booked myself a nearly month long stay at Rosewood Hong Kong's longer term Residence which is like service apartments but obviously a different league, entirely.
The value was very good vs. booking a suite on the hotel side.

I think you'll be surprised in the value you may be able to find. But like all things in this space, it can vary widely between properties.
Thank you for letting me know about the public Dorado Beach offer. 20% off for a stay of just 5 nights is astounding. In your experience, what is a reasonable target for which to aim when negotiating a stay of, for example, 1 month in length? At something like a FS/MO/RC/etc.

Originally Posted by wrldwide1 View Post
If youíre looking to gain night credit or points in a rewards program, make sure you are asking for an extended-stay rate that will still allow you to earn. Sometimes, a special ďmanagerĒ rate is ineligible because itís a deeply discounted rate.
Thank you for pointing that out, I'll be sure to keep it in mind. Is it generally worth paying the premium in order to gain credit/points?
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Old Jun 20, 20, 2:51 am
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The whole thing is entirely dependent on the dates of your stay. Discounts of more than 25% are very rare for long stays in my experience.
I know in the current situation itís a poor example, but if your stay dates include a big conference, event or something similar, the hotel wonít be very keen on you staying there since the would charge sometimes up to 4 times the normal rate, so if itís a 4 day conference smack in the middle of your stay dates, the hotel wonít be keen on you as a long stay guest.

Another reason why discounts at places like FS, MO or similar brands is simply protection of brand identity / rate integrity.
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Old Jun 20, 20, 3:04 am
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On a separate note, a certain luxury hotel in New York offers long-stay monthly (30 days at a time) rates in their top suites at what would be equivalent to roughly 10 nights rack rate. These are suites that typically have very low occupancy. Your monthly rate would be roughly USD 6-figures.

Also, in some jurisdictions, if you stay for more than 30 days, certain city/local/state etc taxes (the kind of taxes geared towards short stays) are exempt.
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Old Jun 20, 20, 9:04 am
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Also check negotiated rates e.g. corporate and government - as these provide an indication of the typical discounts offered to some guests. Corporate rates can often be 25% off the rack rate - and sometime 50%.
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Old Jun 20, 20, 11:15 am
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Originally Posted by Cityflyer10 View Post
I’d curious if you are better off directly approaching someone like the director of sales, versus going through an agent. Not having to pay commissions (~10%) vs no existing relationship. I suppose if the TA really knows the sales team, you are better with that approach, otherwise go directly.
There's a counter-intuitive element to consider — sales managers have annual sales goals; if they meet their goal, they earn a bonus. What counts towards a sales manager's goal are leisure sales made through their "clients" — i.e., TA's. For this reason, sales managers are incentivized to work with TA's — and if there is a reason to be flexible (low expected occupancy levels over that period or an extended stay), a sales manager will work with a TA to make the sale. As CityFlyer10 has said, it helps when the two have worked together for a long time and know each other.

While, obviously, a direct individual sale will be more profitable for the owner, you're not negotiating with the owner. The performance of a hotel's sales team is evaluated by RevPAR (total room revenue divided by total number of rooms). Cost of sales, whether they be commissions paid to a TA or salaries paid to the sales team) are not part of the equation. Neither are utilities, housekeeping, taxes, insurance, etc.

Last edited by DavidO; Jun 20, 20 at 7:45 pm
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Old Jun 21, 20, 1:55 pm
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Thanks for your replies; they have given me a better idea of why this question can't be answered in general and must be negotiated separately for each case.

Originally Posted by erik123 View Post
Also check negotiated rates e.g. corporate and government - as these provide an indication of the typical discounts offered to some guests. Corporate rates can often be 25% off the rack rate - and sometime 50%.
Thank you for the suggestion. Does a public resource exist for finding corporate/government rates?

Originally Posted by DavidO View Post
There's a counter-intuitive element to consider ó sales managers have annual sales goals; if they meet their goal, they earn a bonus. What counts towards a sales manager's goal are leisure sales made through their "clients" ó i.e., TA's. For this reason, sales managers are incentivized to work with TA's ó and if there is a reason to be flexible (low expected occupancy levels over that period or an extended stay), a sales manager will work with a TA to make the sale. As CityFlyer10 has said, it helps when the two have worked together for a long time and know each other.

While, obviously, a direct individual sale will be more profitable for the owner, you're not negotiating with the owner. The performance of a hotel's sales team is evaluated by RevPAR (total room revenue divided by total number of rooms). Cost of sales, whether they be commissions paid to a TA or salaries paid to the sales team) are not part of the equation. Neither are utilities, housekeeping, taxes, insurance, etc.
Thanks for providing more context. It sounds like the best course of action would be to research TAs and find one that has a history with the specific hotels I'm interested in.
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Old Jun 21, 20, 6:32 pm
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A good agent should have such a relationship with the hotel that they can get preferred pricing plus a long stay discount. They will also have Four Seasons Preferred Partner, Rosewood Elite, Peninsula Pen, and so on - because of this, and also due to buying power, they should be able to negotiate a better price than you doing it yourself.

However, good TA's are hard to come by these days.

I used to be one of the travel bookers for a large finance co in NY and they always came through me (their TA) to book their long term stays as they found it was more cost-effective.

Now is the perfect time to get your TA to negotiate a long stay discount with hotels on your behalf as there are so many good deals out there and the hotels are desperate for business. In saying that I have noticed a lot of long-stay apartments have also dramatically reduced their pricing.
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Old Jun 21, 20, 8:09 pm
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Iíve got discounts ranging from 5% to 60%. It really depends what the hotelís priorities are like at the time, and have found the Director of Sales (or Revenue Director if you have an in) to be the best person to speak to.
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Old Jun 21, 20, 8:17 pm
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It is all going to depend on the location and property. If a property believed that it could fill the house at the rack rate, it would not offer anyone a discount at all. On the other hand, there are places which are just reopening and are likely to be relatively empty and might just offer greater discounts than in the past.

You should call Sales directly. Agents are paid a fee or commission and that means a higher rate. As a one-off, there won't be much of a negotiation and you will likely receive a quote for exactly what you ask for. As others note, be clear and concise about ancillary issues such as stay credit, points, meals and the like.
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