X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Allan Saunderson is managing editor of Property Finance Europe and a contributor to GlobeSt.com.

KIEV, UKRAINE-Ukraine has seen only three top-end international hotels opened in the last four years, and while several are under construction, bureaucratic red tape and lack of financing for projects continue to hamper the market, a conference heard recently.

The event in Kyiv organised by international consulting group PKF hotelexperts and hosted by law firm Wolf Theiss and project developer Michaeler & Partner, heard that at least eight large international branded hotels are planned, with one InterContinental scheduled to open in 2009 and three scheduled for 2010 – Fairmont, Holiday Inn, Sofitel. These will supplement the Radisson and Hyatt Regency in Kyiv plus Radisson in Alushta on the Crimean Peninsula. Rezidor Development Manager Darren Blanchard told the conference Radisson Kiev is one of the best performing hotels of the group in Europe.

The conference heard that one international-brand hotel per 15m population is dramatically low; Ukraine has nearly 46m inhabitants. However a large number of domestically managed hotels are present, including the five-star Premier Palace in Kyiv. According to Premier Hotels President Oleg Bolotov, the group manages seven hotels in Ukraine and holds a 20% market share in four to five-star segments. Premier plans to expand to 10 hotels in 2010 and will soon introduce Accord Hotels, a new mid-segment hotel brand.

Despite the challenges, most large international groups would like to enter the market, said Magdalena Sekutowska from Hilton and Ivica Čačić from Marriott Their groups have projects in planning. Starwood Hotels’ Anatoly Kondratenko said he would like to see his group’s brands – Sheraton, Four Points by Sheraton – in Kyiv and other Ukrainian cities.

“Together with Russia and Turkey, Ukraine has the biggest development potential in Europe,” noted Michael Widmann, Managing Partner of PKF hotelexperts. “However, probably in no country in Europe it is more difficult and time-consuming to develop a hotel project, and the lack of financing is the biggest stumbling block.”

Political and bureaucratic obstacles are also keeping investors away. He advised the conference to focus on budget and mid-segment hotels which are desperately needed, avoid mixed-use projects which are not financeable, focus on smaller projects of €10 million to €20 million, ensure a financial commitment by the operator, consider conversions and refurbishments rather than new-build, retain a residential component in new projects, and structure projects carefully to obtain financing.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.