Indeed, given the volatility in the travel market many hotel owners would no longer take the risk of entering a relationship with a hotel operator without the ongoing support of a hotel asset manager.Employed by the asset owner, the role of a hotel asset manager is to ensure a property reaches its full potential so that it can create increased returns in the long term or be sold at the peak of its real estate value.Fred Novella, Managing Director at hotel asset management company Global Asset Solutions, outlines the three main reasons why hotel asset managers have come to play such an invaluable role.Reason #1: They bridge the knowledge gap between owners and operators When owners and operators enter a hotel management agreement, they often do so with different objectives in mind.The operator may naturally be more focused on protecting their brand and on growing their footprint, while the owner may be looking at maximising their profits or the value of the asset.Although the management agreement usually goes some way towards aligning these objectives, it often leans slightly more towards the operator.This misalignment wouldn't necessarily be an issue if there was a greater symmetry between the hospitality expertise of the owner and that of the operator.But large hotel owners aren't always professional hoteliers. They're more likely to be financial institutions, funds, real estate companies, high-net-worth-individuals, etc. - often with little operational experience in hospitality.This lack of experience means they may sometimes struggle to identify the right operator in the first place. And even when they do, they may not always know what to look out for when negotiating the best terms and conditions.This is where we as hotel asset management professionals step in.Our experience in hotel operations, contract negotiations, development and performance management, along with our track record of working with high-profile international management companies in different world regions, gives us the level of expertise some owners may be lacking.And while operators can also offer a great deal of local and tactical expertise during agreement negotiations - often hand in hand with the advice received from their legal representatives - it may not be enough.Hotel asset managers bring a much broader understanding across geographical markets, segments, property types, best practices, brands and operators.This big-picture thinking can be helpful while owners are choosing an operator that's right for their property. Our early involvement often prevents future conflicts down the line.Once a hotel property is operational, we then provide the owner with regular detailed reviews of the financials, Profit & Loss, balance sheets, budgets, cash flow, as well as any advice on capital expenditure.We provide support to the hotel management team with regards to sales strategies, food and beverage marketing plans and any other issues relating to the future of the hotel.We also regularly make sure the voice of operators and the local management team is heard by the owner on security issues, industrial action, delays in opening or any other urgent matters.Reason #2: They are the owner's eyes and ears on the ground Hotel asset managers make sure communications between the owner, the hotel management company and their local team are coordinated in the most efficient way.Our role is to ensure all information - positive and negative - reaches the ownership as quickly as possible. This creates a win-win for the owner and the operator.By being proactive and truthful in all reporting, we make sure there are no surprises for the ownership later on.Each asset manager takes a slightly different approach, but most will produce a monthly market review and a monthly profit and loss review which highlights any major issues.These reports are based on information provided by the operator which is then standardised to make it more easily digestible for the owner.The reforecast and the PACE are also closely monitored to ensure the hotel finishes the year on target or above.We also verify balance sheets, cash flow, summaries of monthly capital expenditure projects, etc.In doing so, we make sure all provided data has been calculated correctly and follows the latest USALI guidelines.We also highlight key points relating to operational departments, operating expenses, human resources, cash flow, balance sheets, statistical data, etc.When it comes to capital expenditure, the asset manager will regularly provide owners with a detailed analysis of where the asset is at, along with the best strategy for going forward.We always seek to immerse ourselves at a property level so that we can provide this type of high-level service.We study how the asset is run, review its capital expenditure, booking pace, the types of groups coming into the hotel - indeed, anything that may impact the profitability of the property.During the construction and pre-opening phase, we will also provide boots on the ground with ongoing site visits and meetings with the regional operational team, future general manager and steering committee.As hotel asset managers, we rely on our detailed knowledge of the hospitality industry across a number of regions, but our experience of working with a variety of different operators is also very helpful.It allows us to support general managers and their teams in using the latest techniques and international best practices relating to hotel sales and marketing, revenue management, commission levels and flow-through.Beyond the level of the individual property, we have an in-depth knowledge of the tourism industry as hotel asset managers.It gives us great insights into potential disruptors affecting the market (think Airbnb, HotelTonight or other OTAs) and any developments in digital marketing, online booking tools and social media - not to mention their impact on commission fees.Reason #3: They act as an arbiter in resolving potential tensions between operators and ownersAlthough as hotel asset managers we are accountable only to the asset owner, our role is to build bridges across different teams.Those who buy into the cliche of the aggressive asset manager telling operators how to run their businesses, will no doubt be disappointed by the courteousness, professionalism and ease with which our interactions take place.Instead of micro-managing general managers and their executive teams, our success depends on our ability to work collaboratively.To achieve the best result on behalf of the owner, we need to be able to work harmoniously with the operator's corporate office as well as local teams on the ground.We're often well aware of the tightrope many general managers are expected to walk between demonstrating accountability towards the hotel owner (as they should), their regional manager and the corporate office (as is often the case).Hotel asset managers regularly provide additional backup to general managers when it comes to pushing for more support from the wider brand, particularly when the local team doesn't feel able to speak up - for example on issues relating to better engineering supervision or increased sales and marketing support.This is why we spend so much time trying to get a full picture of the specific dynamics and limitations each general manager works under.Given the need we talked about earlier to align interests, the role of a hotel asset manager can of course be adversary too.After all, we need to ensure owners only get billed for justifiable expenses and cross-check that revenue and cost items are booked in the right departments.It is also our job to help ensure the best executive team is in place and see to it that operators comply with the most recent accounting standards.Mistakes can and do happen of course. When we pick up a particular issue, we'll first approach the general manager with a request to rectify it.If disagreement with the local team persists, we may then escalate it to the corporate office.If no solution can be found at that point, we'll seek to mediate and identify a way forward which is acceptable to all parties.If it involves an accounting issue, we may also be required to contact USALI.The owner is always informed of any mistakes we pick up on, although minor ones will mostly be dealt with without their direct intervention.Of course, the management team may occasionally consider us a 'fly in the ointment'.But they also know well enough that by us challenging the status quo, they're more than likely to benefit from improvements in practice and performance themselves.ConclusionAlthough still more common in upscale, full-service hotels operated by regional and international hotel companies - hotel asset management is a thriving profession.Given the complexities of the hospitality market, many asset owners highly value the stability and clarity we bring within the relationship between the owner and the operator.And while our ultimate responsibility is to maximise the profit and value of a specific asset, our role has evolved beyond a solely 'checking the books' function.Indeed, our impartial expertise in areas as diverse as real estate, operations, sales, capital expenditure, strategic positioning and marketing, has made us an essential partner in some of the most successful owner/operator relationships.