Number of Five-Star Hotels Set to Double Within a Year
Published: December 6, 2005 (Issue # 1128)
Intercontinental and Ramada are the latest international hotel operators to announce their arrival on the St. Petersburg market next year, while Rezidor SAS also signaled further expansion, Maxim Sokolov, chairman of the city committee for investment and strategic projects, was quoted by Interfax as saying.
“Intercontinental is at the moment in negotiations with those investors who have already started constructing hotels but are yet to find an operator,” Sokolov said.
St. Petersburg already has five 5-star hotels – Grand Hotel Europe, Astoria, Nevskij Palace, Radisson SAS and Emerald.
Earlier this month Raffles International announced the opening of a 5-star business-class hotel in the city by 2007 under the brand Swissotel, while the Renaissance construction firm plans to build a 5-star hotel by the end of next year with the financial backing of Indonesian company Sampoerna.
French operator Accor, which opened a 4-star Novotel in the center of St. Petersburg this year, has already announced the construction of 3-star Ibis and 5-star Sofitel.
According to Sokolov, the international operator Hilton has been interested in coming to St. Petersburg for a long time.
“This operator first held talks about a possible hotel in 1996. At that time they thought the local market was too small. Now any move is hampered by high prices and the lack of central locations suitable for development,” Sokolov said.
Nikita Savoyarov, an expert at the Russian Tourism Industry Union said that the local market is suitable for opening new hotels and Intercontinental, Ramada and Hilton could easily launch projects in the city.
“They are world brands. The process of globalization means hot locations are more important than short-term profits and other economic figures. And St. Petersburg is the eighth most attractive tourist destination according to UNESCO,” Savoyarov said.
According to Ernst & Young, the average occupancy of 5-star hotels in St. Petersburg was only 64 percent last year while in Moscow this figure was 77 percent.
Savoyarov said that transnational corporations could cover losses with profits earned from business in other countries, thereby sustaining 10-years’ worth of investment in a five-star hotel project.
As for factors that prevent the arrival of international operators in St. Petersburg, Savoyarov said that there were several.Pages: