Two models of the hotel industry consolidation
The season ends, it’s time for hotel deals
The Greek and foreign investors who are interested in acquiring hotels units, are waiting for a sign from the banks. It is said that, by the end of the season, the acquisition process of the hotel units is expected to begin, mainly of those facing difficulties repaying their loans.
As hotel agents highlight, no moves have occurred from the banks’ side for the moment. Furthermore, they add that while a year now SETE (Association of Greek Tourism Enterprises) has raised the issue of the liquidity and the facilitation of the capital flows from the financial system, nothing has been done yet. At the same time, on a business level, the competition among large both Greek and foreign investment funds is intensified, aiming at the domination in the new hotel landscape.
Two business models of consolidation and development of existing hotel units will “collide” in the upcoming period. One precedes the purchase of units and the other the taking over of their management. Both models are “represented” by leading associations in our country.
Moreover, according to other hotel agents, there are many investment funds which are examining the Greek market and are considering investments, only if there is a complete investment plan that concerns not only the purchase of land, but also the projects of the new hotel units, up to the contract with major international tour operators.
All these projects are expected to be unwrapped during the upcoming months, after the end of a very positive touristic season, which is a portent for even better results of the following years. However, it should be noted that, overall, the tourism sector is not one of the “over-borrowed” by the Greek economy.
According to the data of the Hellenic Chamber of Hotels, in 2010 the share of tourism financing was approximately 4% and increased up to 5.2% in 2013.
However, a little more than 33%of the funding still remains in the total of the industry.
Overall in the fourth trimester of 2013, the loans given to the tourism sector business was estimated at 7,73 billion euro and it is estimated that more than 50% of them regard the hotel industry.
The turnover of 893 hotel indurties in 2013 was estimated at 2,171 billion euro compared to the 1,888 billion euro one year ago and this reflects the raised profile of the Greek tourism, whereas it should be pointed out that the losses of the industries declined significantly from 284,8 million euro to just 25,24 million euro during 2013.
Source – NAFTEMPORIKI