Adria Hotel Forum, Zagreb (Feb 2017)
Philip was invited to moderate a panel at the 5th Adria Hotel Forum in Zagreb, Croatia, in February 2017. The panel discussion was based on the theme of development in the region and his panellists were Ivana from Valamar Riviera, Tarik from Ascendant Project Finance, Federico from Catalonia Hotels and Sebastian from T3 Hospitality Management. See Phil's "takeaway nuggets" below:
- STR data showed that the Croatia Coast market performed strongly in 2016, up 44% in RevPAR, and with a very limited pipeline.
- Local banks will lend 65-70% LTV, debt coverage of 1.2x, with a solid sponsor and a brand preferred. Will finance anywhere in Croatia if business case is solid. They are open and keen for business.
- According to a luxury hotel manager, luxury hotels will boost city developments, but need to achieve around €400 ADR if want to provide genuine luxury hotel services and in order to pay for such generosity.
- In Croatia, more than 50% of rooms are in private accommodation.
- The sharing economy will have the greatest impact on budget and hostel sectors, and not so much on the full service or aparthotel segments.
- Uber is planning to launch Uber-boats in Croatia, the first commercial service in the world, with trials around the Dalmatian coast and islands beginning in summer 2017.
A group of students presented their award-winning project to the audience. How to create a new tourist destination in rural Croatia and drive demand year-round to Erdut, the "4 Seasons of Erdut":
- Sacred Weekend (summer period): religious tourism, overnight experiences, make food and beverages from the olden days.
- Wine & Bike Weekend (autumn): showcasing wine and cycling is growing in popularity.
- Heritage Weekend (winter): a three-day package, appreciating local arts and crafts, and encourage to make themselves in tents.
- Sports Weekend (spring): outdoor activities and Danube boating/fishing.
- Diffused hotel concept - a central hotel building and work with small guest houses elsewhere in the village (eg Sibenik).
During Phil's panel session, he asked the panellists: Where would you invest and in what?. There responses are summarised below:
- Rural retreat in a protected natural habitat in northern Croatia.
- Hostel in any large-scale city in the region.
- Quality seaside resort with residential, within 50km of an international airport.
Phil's survey question to the audience was: What is the most important constraint to attracting investors to invest in new developments in the region? Responses to the multiple-choice answers are summarised below:
- Flights - 20%
- Local regulations - 60%
- Weather seasonality - 10%
- Tenure and clear title issues - 0%
- Staffing and skills - 0%
- Lack of or incorrect non-hotel product - 10%