Mid-market hotels offer best ROI potential

    150 150 Daniel Fountain
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    Turkey needs quality, branded mid-market and economy hotels in secondary cities delegates were told at CATHIC (Central Asia & Turkey Hotel Investment Conference) which concluded in Istanbul (on Wednesday February 9 2011).“Turkey is crying out for branded, consistent, quality mid-market hospitality products,” said Michael Collini of Hilton Worldwide. Poğda Demircan, Hilton’s Development Manager for Turkey agreed. He also pointed out that the room rate gap between upscale and mid-market hotels could be quite small in regional cities.

    “At the end of the day, there is a maximum price customers will pay for a room in provincial city locations. This means that the greater operating profit will be for the mid-market operator who has lower development and operational costs, and not for the five-star properties.”

    Potential investors and developers also heard the case for and against opting for Turkish and international brands.

    The general consensus was that home-grown brands, such as the event’s supporters – Rixos, Dedemann and Marmara have excellent local knowledge and know what suits the market. On the flip side,the international brands have high global visibility and well-tuned operations.

    “The conclusion is to avoid making choices based on ‘ego’ and choose the brand that will deliver the best return on investment for each project,” said conference delegate, Turkey-based Banu Ogawal.

    Elif Egeli Nişanci of Jones Lang LeSalle Hotels summed up the issue by advising that development should not be for the sake of development: “Make sure that the supply matches the demands of market to ensure the project will maintain good rates.”

    Delegates taste Turkey An evening at the stunning Marmara Esma Sultan provided an opportunity to digest the day’s events. This is a memorable venue, with views of the Bosphorous Bridge and Ortaköy Mosque, innovative design with a steel and glass structure within the walls of the historic palace, and delightful staff and service. All who attended agreed that this venue certainly has the ‘wow’ factor.

    Spotlight on region-based award winners The CATHIC Hotel Investment Awards were presented to:
    • Best new hotel in Turkey: Pera Palace Hotel Istanbul
    • Best new hotel in Central Asia: Radisson Blu Iveria Hotel, Tbilisi
    • Outstanding achievement award: Haluk Kaya, Chairman of Bekay Property Partners.

    Daniel Fountain / 10.02.2011

    Editor, Hotel Designs


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