The Essential Guide to Treehouse Resort Development

Essential Guide to Treehouse Hotel Development

The hospitality industry in the UK is witnessing a remarkable shift. Staycations have taken a turn towards sustainable treehouses and resort cabins, particularly those that offer an enticing blend of hotel-like luxury and the allure of escape.

Why Treehouse Hotels?

Treehouse hotels provide an unparalleled experience that allows guests to disconnect from the hustle and bustle of everyday life and reconnect with nature. They offer a unique form of accommodation, blending luxury with eco-friendly principles, creating a one-of-a-kind stay for guests looking for something out of the ordinary.

Sustainability at their Core

Treehouse hotels are designed and built at Oasis Habitats using sustainable materials and methods, making them environmentally friendly and low-impact. With the increasing demand for sustainable tourism, sustainable treehouse hotels are becoming a popular choice for travellers who want to reduce their carbon footprint while still enjoying a luxurious stay.

Unique Designs

Treehouse hotels come in various shapes, sizes and styles, making each one a unique experience. From cosy cabins nestled in the forest to luxurious treehouses with private hot tubs and panoramic views, this accommodation offers something for everyone.

Understanding your investment

Treehouse hotels can cost more to build than traditional hotels due to their unique design, accessibility and materials. However, they also offer higher returns on investment as they can charge a premium for the experience. It’s crucial to have a thorough understanding of the costs involved before seeking financing.

Here are some key areas to consider:

  • Design and Construction: The cost of designing and constructing a treehouse hotel will vary depending on the size, complexity, materials used and location. It’s essential to work with experienced architects and contractors who understand the unique challenges of building in and around trees, as well as within nature.

“MEP-integrated SIP Panels can help you cut construction costs because they provide insulation, structural support, and electrical wiring in one integrated system. They also reduce construction time and minimise disturbance to the surrounding environment.” Damon Farrell, Oasis Habitats

  • Permits and Regulations: Building a commercial treehouse hotel will require planning permission from local authorities. It’s crucial to understand all the necessary permits, regulations, and restrictions before beginning your project.
  • Utilities and Amenities: Treehouse hotels can reply on off-grid systems as well as mains connection for electricity, water supply, and waste management. These can be costly but are necessary for construction and operational purposes of the resort.

Obtaining the Initial Investment

The burgeoning popularity of this trend has piqued the interest of landowners, farmers, and property developers alike. Many are now exploring the possibility of venturing into the treehouse resort business, seeking to capitalise on its potential for significant returns on investment.

However, financing such a venture can be challenging. This is where specialist consultancy service Oasis Habitats steps in. With expertise in treehouse financing and planning permission, they provide the necessary guidance and direction to make your treehouse investment achievable.

Here’s our shortlist to obtain your initial investment

  • Traditional Bank Loans: This is the most common and straightforward method of obtaining financing for your treehouse hotel project. You can approach a bank or other financial institution to secure a loan based on your business plan, credit history, and collateral.
  • Crowdfunding: In recent years, crowdfunding has become an increasingly popular option for funding creative and innovative projects. Platforms like Kickstarter and Indiegogo allow individuals to pitch their ideas and receive donations from interested parties.
  • Angel Investors/Venture Capitalists: These are high net worth individuals or firms that provide financial backing for startups and businesses with high growth potential. They often take an equity stake in the business in exchange for their investment.

If you are interested in meeting financiers to help you get your treehouse hotel off the ground, signing up to the Treehouse Resort & Development Association will enable you to learn more about potential matching service.

Exploring Financing Options

Financing your treehouse hotel is a significant undertaking. It’s crucial to explore all your finance options and choose the one that best suits your needs and goals.

Here are some additional financing options to consider:

Government Grants

There are plenty of government grants accessible to a variety of businesses. Considering the pandemic and the various changes resulting from Brexit, the UK Government is specifically assisting rural communities and promoting sustainable development in these areas.

Could your treehouse hotel be eligible for a grant? Find out more from the Government website.

Pre-Sales or Off-Plan Sales

If your treehouse hotel is already built or under construction, you have the opportunity to generate revenue and demonstrate the profitability of your venture by offering pre-sales on rooms. This allows you to attract potential investors and showcase the value of your project.

Local Authority Grants

It’s always worth reaching out to local authorities and exploring government funding options to see what financial support may be available. Even if not specifically for the purchase and construction of your treehouse(s), there are often grants for small businesses that can contribute to the growth of your enterprise.

Crowdfunding

Crowdfunding is a widely embraced method to secure funds for projects, charities, or initiatives. Depending on the chosen approach, contributors may anticipate receiving equity in your business as a token of appreciation for their financial support.

Joint Ventures

Members of the Treehouse Resort & Development Association can also explore joint venture opportunities with existing hotels or resorts, and each other. The hub connects developers, landowners, designers, architects and lenders to facilitate discussions and potentially profitable partnerships. 

  • For example, a hotel in a desirable location may provide the perfect spot for a treehouse resort expansion and benefit from sharing their resources, clientele and credibility with the new development.
  • A landowner may already possess planning permission for treehouses or glamping pods on their property, but require financing to get started.
  • An architect may have a unique design for a treehouse hotel but needs connections to secure funding and make the project a reality.

By connecting developers with various stakeholders, Treehouse Resort & Development Association offers an ideal platform to explore joint ventures and find potential partners for your treehouse hotel development. 

Bank Loans

For any business venture, bank loans are available. In fact, borrowing by small and medium-sized businesses has increased significantly in recent years. It’s worth doing your research and shopping around for the best rates and deals; there are a lot of options out there, especially for landowners.

Remember, with bank loans, you will need to produce a solid business plan that outlines your vision, target market and projected financials. You may also be required to provide collateral or personal guarantees.

Brokers

Sector-specialist brokers can provide expert guidance and source suitable loans tailored to the needs of the sustainable tourism sector. There are several brokers specialising in treehouse hotel and cabin resort loans, assisting individuals and businesses to secure the necessary funds.

Tax benefits

For those looking to invest in a treehouse hotel, there are various tax benefits that can help to offset the initial investment and ongoing operational costs. These include:

  • Capital Allowances: UK businesses can claim capital allowances on the cost of certain types of assets, including buildings and structures used for commercial purposes. This can significantly reduce your taxable profits.
  • Business Rates Relief: In England, small businesses may be eligible for business rates relief, which can provide a significant reduction in the amount of business rates they are required to pay.
  • Renewable Energy Incentives: If your treehouse hotel uses renewable energy sources such as solar or wind power, you may be eligible for government incentives such as Feed-in Tariffs or Renewable Heat Incentives. These schemes provide financial support for businesses that generate their own electricity or heat.

Your business plan

When considering financing options, it is crucial to have a solid business plan in place. This should include projected occupancy rates, marketing strategies, and potential partnerships with local businesses and event organisers. Oasis Habitats can assist in developing a comprehensive business plan that will help secure funding from various sources.

Key facts

With the rise in demand for sustainable tourism and treehouse resorts becoming a widely popular tourist destinations. This makes them appealing to investors and grants from various organisations. An average nightly rate for treehouses in the UK ranging from £150 to £480, and occupancy rates fluctuating between 70% and 100%, these ventures can yield substantial returns. Furthermore, treehouse hotels typically achieve payback within two to three years.

Components of your business plan

A convincing business case extends beyond just a solid financial plan. It also includes several other key components that are crucial to your treehouse hotel’s success:

  • Market Analysis: It’s vital to have a comprehensive understanding of your potential customers. This involves analysing the demographics, psychographics, and booking behaviour patterns of your target market. Understanding who your guests are, what they want, and how they book is key to defining your service offering and marketing strategy.
  • Competition Analysis: Study your competitors, their locations, services, pricing, and customer reviews. This will help you to identify your unique selling points and inform your positioning strategy.
  • Marketing and Sales Strategy: This outlines how you plan to attract and retain customers. It includes your planned activities in advertising, public relations, digital marketing, direct sales, and customer relationship management. 
  • Operational Plan: Detail your plan for day-to-day operations. This encompasses everything from staffing and customer service to maintenance and sustainability practices.
  • Risk Assessment: Identify potential risks and how you plan to manage them. This includes financial risks, regulatory risks, and operational risks such as natural disasters or pandemic-related disruptions.

By integrating these components into your business case, you provide potential investors and partners with a complete picture of your vision, the market potential, and how you plan to achieve your goals. This can significantly increase your chances of securing the financing and support you need to make your treehouse hotel a reality.

Planning permission for your treehouse hotel

In addition to financing, obtaining planning permission is often a hurdle that investors must overcome. Oasis Habitats can provide advice on navigating the complex planning process, ensuring successful approval for your treehouse resort.

The UK’s planning system aims to balance the development needs with environmental and heritage protection. Thus, seeking permission depends on several factors including the size, location, and impact of the proposed treehouse hotel on the surroundings. 

Rules for permitted development

Generally, if your treehouse is not within the curtilage of a listed building, is not in a conservation area, and meets certain size guidelines, it may be considered a ‘permitted development’ and not require explicit planning permission. However, it’s important to note that this is only a general guideline and specific considerations can and do often apply.

Conservation areas

For instance, if the treehouse is to be used for commercial activities such as a hotel, planning permission is likely required irrespective of size. Similarly, developments in Areas of Outstanding Natural Beauty (AONB), National Parks, or in conservation areas often have stricter controls.

Tree preservation orders

Moreover, tree preservation orders (TPOs) or protected tree types can also affect planning. Any work performed on a tree under a TPO would need local council consent. Hence, it’s crucial to check for any TPOs in your chosen location.

With our in-depth knowledge and experience, we can assist you in understanding the complexities of planning permissions, making the process less daunting and more manageable. Our team will work alongside you to ensure a successful application, to bring your project one step closer to completion.

Treehouse hotels and woodland cabins make great investments

Investing in a treehouse hotel not only offers the opportunity for significant returns but also provides a chance to contribute to sustainable tourism in the UK. With the support of Oasis Habitats, turning your treehouse dream into reality has never been more attainable.

Interested to know more?

If you’re considering venturing into the world of treehouse resorts, don’t let financing and planning permission hold you back. Seek guidance from industry experts at Oasis Habitats and embark on a journey towards a successful and sustainable treehouse hotel venture. 

We offer comprehensive services spanning concept design, construction, and exclusive membership to the Treehouse Resort Development Hub to help you find the right lender.

To stay up to date with the latest news and developments in the world of treehouses, treehouse hotels woodland cabins, sustainability, and related topics, sign up for the TRD Alliance newsletter. With the right guidance and resources, we can help make your treehouse dream a reality.