7 Tips for the PIP

A Property Improvement Plan or “PIP,” not to be confused with Gladys Knight & the Pips, is a detailed list of property improvements required at specific times in the hotel property life-cycle. The purpose of a PIP is to maintain brand standards and keep the hotel appearance current.

Without a PIP, the brand standards and consistency could become problematic. While we can all appreciate their importance, we can also understand the challenge that a PIP can bring to the bottom line of a property owner’s balance sheets.

Not only have I heard it through the grapevine,” but I know from experience that this is true.  Here are some ways to deal with the challenges often found by hotel owners as they relate to their PIP programs.


Change in Ownership: The sale of a hotel, resort or casino property will often trigger brand-required updates to the property’s facilities through a PIP Renovation. Whether buying or selling, there is a benefit of knowing the cost for executing the work outlined in the PIP, in advance of offering or accepting the Purchase and Sale Agreement (“PSA”). Often the buyer and seller have different sets of cost projections, but when a detailed estimate has been completed, the difference in numbers can quickly be addressed.  Often, the seller uses an inflated PIP Cost to discount a property’s sale price. Thru DRB’s PIP Cost Estimate, inflated numbers can be quickly resolved.

Designing to a Budget: Success of any renovation program is increased when the design team is charged with designing to an itemized budget. Too often our role is to get parties back on track after the designer is asked to provide a design that meets the brand PIP outline. The designer offers their concept that may or may not achieve the financial limitations.  Having an estimate prior to releasing a designer establishes expectations and design criteria towards what ownership wants to spend.


The Good News: there is a way to be prepared in advance AND avoid the issues noted above. As PIP Cost Advisers, we draw from our experience with multiple properties and brands, finding cost solutions that meet the brand requirements and ownership budgets. These are then outlined in the PIP Cost Estimate providing direction for negotiating the sales price and directing the design team towards the desired financial solution.

Ownership benefits from current pricing and a working knowledge of how to read between the lines of PIP requirements. Local site conditions will also play a part in defining the cost solution(s) that will meet the brand expectations.

The PIP Cost Estimates should define the design criteria, enabling ownership to gain the confidence in the accuracy.


Select an expert that fulfills these requirements:

1 Has a minimum of 5 to 10 current years of PIP pricing experience

2 Actively manages PIP projects and brings the benefit of real, ongoing project experience

3 Always includes a site visit and conducts key personnel interviews during a property evaluation

4 Always consults the brand standards related to the specific PIP requirements

5 Always consults with the PIP brand representative to clarify site specific PIP item requirements

6 Understands how to reflect PIP intent into the pricing as it relates to site specific conditions

7 Will take the time and has the ability to communicate clearly and effectively with owners and brokers regarding PIP pricing questions in support of the transaction

Be proactive. Be prepared. Be accurately informed.

Follow these steps and you will singing, “this is the best thing that ever happened to me!”