Gr Hotels

Executive Summary:

GR Hotels is a privately owned lodge that operates two large mid-sized hotels in Toronto and in Montreal. They have been booming over years and has been recognized as a mid-scale brand.

payable to the competitiveness of the market as well as an pass judgment growth in worldwide tourists, the Board of Directors decided for GR to filtrate to improve occupancy rates and thread more melody travellers.

As well, the shareholders as well as indicated that they will invest up to $1 million if any new investment proposed generates an after-tax return of 15%. GR also needs to ensure that their operating profit as a percentage of revenue is at least 11% in vow to meet the banks restrictive covenant.

GR currently has deuce-ace alternatives: 1) To upgrade both their hotels in Toronto and Montreal to upscale in order to meet the industry trend to stay at more upscale/luxury hotels, 2) To exercise their land option in Montreal and sell it for a quick profit so the amounts could be invested elsewhere, or 3) Exercise their Montreal land option to build a business conference center in order to attract more business travellers to generate additional revenue.





GR Hotel needs to involve an option which will meet the goals of the board of directors, while staying on track as to not drift away from the companys mission and vision statements. In addition, GR Hotel needs to also ensure the alternative they choose meets the bank covenant of 11%, and meets the shareholders required return of 15% in order to fall upon additional financing.

Lastly, GR Hotel needs to choose an option which minimizes the amount of risks and weaknesses deep down the organization as well. There are currently a number of organizational weaknesses within management itself which needs to be solved along with the alternative deemed most beneficial to the organization.

by our findings, it is recommended for GR to upgrade both of their hotels to upscale status as it is the least risky...If you want to get a full essay, order it on our website: Orderessay



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