Rising Operating Costs and Hotel Buildings: Where Deferred Maintenance Hides

Hotel operators are describing a stable demand picture alongside cost increases that have not let up, and hotel values have been recovering off their lows. For an owner, that is a workable position. It is also the exact condition under which capital maintenance quietly slips.

Short answer: in a lodging asset, deferred maintenance concentrates in five places that are easy to postpone and expensive to postpone for long. A Property Condition Assessment prepared under ASTM E2018-24 documents observed condition, lists immediate repair needs, and produces a long-term cost table so the owner is making a decision rather than absorbing a drift.

Why hotels defer differently than other asset classes

Most commercial buildings can absorb a deferred repair without an immediate revenue consequence. A hotel cannot, because the repair itself takes rooms out of inventory. That creates a real incentive to wait, and waiting is often the right call in isolation.

The problem is that the individual decisions are rational and the cumulative position is not. Each deferral is defensible on its own. What is missing is a document that adds them up.

Where it accumulates

Guest bath waterproofing

Shower pan membranes, tub surrounds, and grout joints fail slowly. The symptom is usually not in the room with the failure; it is staining or soft flooring in the room below or in the corridor. By the time it is visible from the corridor, the assembly behind the tile has been wet for a while.

This is a scope question worth settling before an assessment. A representative sample of guest rooms should be observed, and the sample size and selection method should be stated in the report.

PTAC units and packaged equipment

Individually, a PTAC replacement is a small number. Across a two hundred key property it is not. The useful exercise is treating the units as a fleet: how many, what age distribution, what condition, and what the replacement curve looks like over the assessment term. Very few properties have that written down.

Corridor and stair fire doors

Fire doors in a hotel take damage from carts, get repainted during soft goods renovations, and get held open during work. NFPA 80 requires that fire door assemblies be inspected and tested annually and that a written record be maintained. A labeled door that has been field modified is no longer the assembly that was tested, and a label that has been painted over is itself a deficiency.

Annual fire door inspection is a small, discrete scope with a documented output, and it is one of the few life safety items with a clear annual cadence.

Vertical transportation

Elevator modernization is a large capital item with a long lead time. The assessment should record equipment age, control type, observed condition, and the status of the maintenance contract and inspection certificates. Elevator work is specialty work; a Property Condition Assessment identifies the need and the likely magnitude, it does not substitute for a contractor's evaluation.

Roof, envelope, and pavement

Low-slope roofs, exterior sealants, and parking areas are the classic long-term cost items. They are also the ones most likely to be pushed, because none of them affect a guest's stay until they do. Standing water on a low-slope roof, in particular, is worth taking seriously in a climate that also carries a snow load.

What the report should actually give you

ASTM E2018-24 distinguishes between immediate repair costs and long-term costs, and that distinction is the useful part. Immediate items are the ones a reasonable owner would address now: material physical deficiencies, life safety items, and code violations. Long-term costs are the ones that fall within the assessment term and should be planned and funded.

The standard also sets a reporting threshold: opinions of cost below a stated amount are typically omitted, though the guide notes that where several like items fall below the threshold but collectively exceed a larger amount, they should be included. That mechanism is exactly what catches the PTAC fleet problem.

One caution we apply to our own work: cost opinions in a PCA are order-of-magnitude budget figures, not bids, and expected useful life tables vary by source. We do not publish life expectancy figures we cannot attribute.

Common questions

Do I need a full PCA or just an inspection?

If a lender or an acquisition is involved, a PCA under ASTM E2018-24 is usually what is expected. If you own the asset and want to understand your capital position, a building maintenance inspection with cost planning covers the same ground with a scope tailored to your questions.

How often should an owner refresh it?

That depends on the age and condition of the asset and on how much capital work has been completed since the last one. Owners commonly refresh on a multi-year cycle and update between cycles when major systems are replaced.

Working with Northline

Northline Inspection Co. performs Property Condition Assessments, building maintenance inspections and cost planning, and annual fire door inspections for hotel and lodging assets across Boise, the Treasure Valley, and Southern Idaho. Call (208) 254-1940 or email info@northlineinspection.com.

Source: CoStar Hotels Daily Update, August 7, 2026.