Wellness in Hotels: An ROI Reality Check

Despite commanding premium rates, hotels with spas often struggle with labor costs and other fixed expenses, according to an analysis of 11,000 hotels worldwide.

Hotel operators investing heavily in spas and other wellness facilities are discovering an uncomfortable reality: more revenue doesn't always mean more profit.

Profit growth lagged at major wellness hotels last year. They managed just 1% growth in gross operating profit per room. Yet minor wellness properties achieved 5%.

That's according to a new study that compared hotels whose wellness facilities generated more than $1 million a year, or at least 10% of total hotel revenues, with ones that had minor wellness offerings. The report by the consultancy RLA Global, is based on data from more than 11,000 hotels worldwide, via HotStats.

The biggest drag on margins is payroll, which is largely a fixed cost regardless of occupancy.

"They have to be trained personnel," noted Gregory Miller, vice president, lodging, experiential leisure, and wellness equity research, at Trui