Services
Operating Model Design
How will this building run in year five, and who pays for it?
How the building actually runs, settled before sales.
Why it matters
The brand agreement puts a name on the building. The operating model decides how the building is governed, staffed and paid for over the next 20 years: who governs, who employs the team, which services owners receive and what they pay for them.
Most of these choices are made during development, often by default. A service promised in a sales brochure becomes a cost in the owners' budget. A management arrangement agreed with the brand sets who can change standards later. Once units are sold, each of these is a commitment, not an option.
The operating model is due diligence on how the asset will run, the same way developers do due diligence on land, planning and construction.
What the work covers
Who decides
We set out who holds authority over budget, staffing, service scope, suppliers, standards and fees: the owners' association, the building manager, the operator, the brand and the individual owner. Residential ownership does not give an operator the authority it has in a hotel, so this has to be designed, not assumed.
How services are delivered and staffed
We define the service scope, who employs the residence team, and how services are contracted. Local rules often decide this. In some markets the entity that manages the building cannot employ hospitality staff directly, which changes the structure.
How costs are recovered
Service charge or service fee, cost recovery or commercial margin, and what owners pay for what. The answer shapes owner expectations and the operator's incentives from the first budget onwards.
How the brand deal is paid for over time
Licence fees, naming fees charged through the service charge, management or supervision fees and pre-opening fees. We set out who pays each, when, and on what basis, so the brand's income and the building's service quality pull in the same direction.
How standards change
Brand standards will evolve over 20 years. We define who can propose a change, who approves it and who pays for it.
What happens when things go wrong
Escalation, enforcement and remedies that work in practice, because ending a brand agreement is deliberately difficult.
Rental programme design
Where there is one: owner use, revenue split, how the programme sits with the service model and with local short-stay rules.
Regulation by market
The same operating model will not work in Dubai, Greece, Portugal and Spain. We design for the rules of the market the building sits in.
Operational design audits and reviews
Plans and brand mandates reviewed for how the building will run: back-of-house, service routes, amenity scale and staffing, and the service charge they create. Space goes where it earns, protecting Net Sellable Area (NSA).
Reviewing a building in operation
For developers and asset owners once the building is running: how it runs today against what the agreements require and what owners pay, who holds authority in practice, and where standards or costs have drifted. We separate brand-driven costs from building costs so the discussion is about facts.
How we work
Brief
We review the project, the brand position, the sales plan and any agreements already in draft.
Options
We set out the workable operating models for the project and market, with the trade-offs of each.
Design
We develop the chosen model in detail with your team, legal advisers and, where appointed, the brand.
Handover to the documents
We brief lawyers and the sales team so the agreements and buyer materials say the same thing as the operating model.
Is this for you?
Who it is for
Developers and investors, asset owners reviewing a building in operation, hotel companies setting their residential operating approach, and advisory firms that need operational input on a mandate.
When to bring us in
Before the sales launch and before the brand agreement is final. The earlier the operating model is settled, the more options remain open.
What you receive
- A written operating model: governance, service delivery, staffing structure, cost recovery and fee structure, standards and enforcement.
- A one-page view of who decides what.
- An indicative service and cost framework for the first years of operation.
- A briefing note for lawyers and the sales team.
In a mixed-use scheme
In a mixed-use scheme, the operating model also sets how the residences share services, spaces and costs with the hotel and retail on the same site.
Questions we are often asked
Is this not the operator's job?
The operator will run the building, but the operating model sets the terms it runs under. Developers benefit from settling it independently before those terms are agreed.
We already have a brand. Is it too late?
No. Until units are sold and agreements signed, most elements can still be shaped. After that, the work moves to making the agreed model work well.
Do you work with our lawyers?
Yes. We set out how the building should run; your lawyers draft the agreements that make it binding.
Why us
Our operating models are built on operating experience, not on frameworks. We design each one knowing what it will cost once owners are paying.
Settle the operating model before the sales launch.
Get in touch