The Wellness Investment Dilemma: Modernising Luxury Spa Facilities in a Fast-Moving Market

Wellness is a core offering at the newly-opened Park Hyatt London

One of the most persistent challenges I face when developing wellness concepts and facilities for luxury hotel properties is the investment conundrum. Whether it’s a new property or an existing operation, owners and hotel operators remain hesitant to commit significant capital to wellness facilities despite being increasingly vital to guest experience and competitive positioning. This tension reflects a fundamental challenge: how to create enduring wellness spaces in an industry where guest preferences and trends evolve rapidly.

The investment conundrum manifests differently across the luxury hotel landscape. Owners of existing properties with dated facilities face particularly tricky decisions. While luxury spas are often profitable, their modest revenue contribution compared to rooms and F&B makes substantial renovations or upgrades difficult to justify. This view, though financially prudent in the short term, potentially overlooks wellness's broader impact on property performance and competitive positioning.

Similarly, forward-thinking ownership groups developing new properties acknowledge modern wellness facilities as essential in luxury offerings. However, valid concerns persist about design longevity and future investment requirements. The rapid evolution of wellness trends creates uncertainty about how long any given facility will remain relevant before requiring updates.

With more and more luxury hotels looking to bring wellness forward as part of their core offering, acknowledging these concerns and considering ways to break the deadlock has become an important piece of work. And success in securing wellness investment now hinges on positioning more than ever before.

The Business Case

SHA Wellness Clinic in Mexico

Today's leading wellness facilities require a sophisticated blend of timeless design elements and adaptable features. These don’t come cheap.

For a new luxury property, the initial investment in wellness facilities can range from $8-15 million, with ongoing capital requirements for updates and enhancements. This presents a significant hurdle for owners, particularly when weighed against more traditional revenue drivers like rooms and F&B outlets. Yet the business case for wellness investment extends far beyond direct spa revenue.

Rather than presenting standalone spa initiatives, the most compelling proposals demonstrate ripple effects across the property. Modern wellness facilities typically drive a 15-25% premium on room rates, extend average length of stay by 0.8 nights, and significantly enhance both corporate group capture and loyalty program engagement. These broader impacts often dwarf direct spa revenue, but are frequently overlooked in traditional ROI calculations.

For existing properties, the key is in identifying high-impact, modular upgrades that can revitalise the wellness experience without requiring complete facility overhauls. Treatment rooms can be refreshed with adaptable lighting systems and integrated technology, allowing for evolving treatment protocols and guest preferences. Public spaces and relaxation areas often benefit most from strategic redesign, as these create immediate visual impact and support new revenue streams through membership programs and day guests.

This approach, combined with staged investment options and clear ROI projections, helps balance ownership's financial concerns with the competitive necessity of maintaining compelling wellness offerings. More importantly, perhaps, it demonstrates to owners and hotel operators an understanding of the broader business imperative and reframes wellness as an opportunity rather than a liability. Essentially, you want to show them you’re speaking the same language.

Operational Excellence as a Foundation

A high-performing Wellness team delivers the best ROI

While discussions about wellness investment often centre on facility upgrades and design, the true engine of success lies in operational excellence. A beautifully designed spa with mediocre service will underperform against a dated facility running exceptional operations. This reality demands equal attention to operational investment – in people, protocols, and performance management.

The foundation of a high-performing wellness operation requires modern team structures, moving beyond legacy staffing models that no longer align with modern wellness delivery. Restructuring might mean introducing new roles like wellness concierges, recovery specialists, or dedicated program coordinators. It could also involve shifting from traditional hierarchies to more fluid, service-oriented structures that better support personalised guest journeys. Leading facilities are also investing in comprehensive training programs that blend technical skills with guest interaction protocols and business acumen.

Operational excellence also extends deeply into marketing and revenue management. High-performing facilities treat each wellness space, treatment room or wellbeing experience as a revenue centre. This commercial focus pairs naturally with service innovation – developing signature treatments that blend traditional techniques with modern technology and unique experiences to create comprehensive wellness packages.

In terms of cost, these investments are the most budget-friendly and tend to provide both the greatest gain and the most sustained growth in revenue over time. One of my go-to points in discussions with owners and operators is that competitors may be able to copy facility design and create similar wellness offerings, but they can’t easily replicate a high-performing team with the ability to work in concert with the rest of the hotel’s operations.

The Right Story at the Right Time

Wellness investments often have a long and difficult path to approval. Even with a solid business case, obtaining approval for wellness investments has to clear a myriad of hurdles and key stakeholders. Success in this stage of the journey often comes down to two critical elements: compelling storytelling and good timing.

The art of storytelling in wellness investment proposals cannot be understated. If you can paint a picture of how the wellness offering will transform the guest experience, elevate the property's position in the market, and increase revenue, you’re giving yourself the best chance of success.

A great story does more than get an owner behind the vision too. When done well, they’ll be enthusiastically sharing it with other stakeholders and feeling like it’s an opportunity they can’t afford to miss, instead of another costly amenity.

With timing, what makes or breaks the proposal is how well it aligns with the broader property initiatives. For new developments, that means weaving wellness into the property’s core identity to ensure it’s adequately planned and budgeted for. For existing properties, it’s capitalising on a scheduled renovation, new market positioning or global strategy shift that reflects evolving trends.

I tend to think of it this way - it’s not about seeking approval, it’s about developing an understanding. I want to create genuine enthusiasm around wellness for each property and make sure it becomes an integral part of the property's success story (if it isn’t already). Owners and operators are the most powerful champions so having their support will only serve to enhance and amplify the wellness vision long-after it’s signed-off.