International Hotel Chains Eye Big Romanian Cities

International hotel chains plan to invest 1.1 billion euros in the next three years in Romania’s hospitality industry, said a study of the Peacock Hotels - GHM, a consultancy company for the industry.

Last year some 400 million euros were invested in tourism, of which 68% in hotels. Other 15% funded B&Bs, 11% - transport vehicles, and 6% - ski tracks management.

Famous international chains like Marriott, Hilton, Sheraton and Four Seasons eye Romania lately.

Golden Tulip Hotels franchised four hotels in the past year, and assessed ten others for a future expansion. Cendant Group, with the brands Howard Johnson and Ramada, plans to franchise some 30 hotels in the next ten years.

Accor Group, via its partner Continental Hotels, will add a Novotel hotel brand in Bucharest to the three Ibis hotels it manages in the country, also targeting the two-star hotels.

"The next three years operators in the hospitality industry will aim rebuilding historic sites in center cities, build the infrastructure for the rural and ecologic tourism or the sea- and river-ports on the Black Sea and the Danube," said Paul Marasoiu.

This year started the construction of some 58 hotels all over the country. Investments for three-star hotels are stagnant, but those for four- and five-star hotels are on the rise, particularly in big cities like Iasi, Timisoara, Constanta, Cluj, Arad, and Sibiu. I

nvestors will move then towards Suceava, Baia Mare and Targu-Mures.

On 2006 some 1,600 new hotel rooms will open in Bucharest, of which 44% - of five-star standard, 25% - of four-stars, 8% - of three-star, 10% - hotel apartments, and 13% - of two star standard.

Last year 1,500 new hotel rooms entered the hospitality market of three- and four-star standard, of which 78% in new buildings. Business tourism continues to be the driving engine in the hospitality industry, giving 76% of its revenues. Last year this market segment grew 36% in Bucharest, according to Peacock Hotels- GHM. "Unfortunately Romania has to opt out of six to seven important events per year because it has limited capabilities to organize events on a large scale," said Paul Marasoiu. For an event bringing in 2,000 participants the revenues could reach 5 million euros, but Romania may not host events for more than 1,500 people.