SOFIA (Bulgaria), December 4 (SeeNews) – Polish-listed hotel group Orbis eyes new markets in Southeast Europe (SEE) through 2020 in a bid to tap the region’s economic growth potential, Orbis Hotel Group President and CEO Gilles Clavie said.
“The SEE countries are considered economies with the fastest growth in Europe. We see an opportunity window for further growth and transformation with a rising number of investments, low interest rates and their stimulating effect on economic activity and subsidiary financing supported by EU funds,” Clavie told SeeNews in an emailed interview.
In his view, this robust economic backdrop, coupled with the low hotel brand penetration rate - in general, the brand penetration in the region is between 6–8 % which is far below the overall EU figures of 25%, creates room to look for development opportunities in SEE. “Countries south of Poland will drive Orbis growth in upcoming years,” Clavie said.
The bulk of the upcoming new Orbis hotels will be opened in Poland, in the Baltic states and a few in Romania.
In January, Orbis signed an agreement with its strategic shareholder AccorHotels to acquire 46 of its hotels in six countries in Central and Eastern Europe and to operate its hotels in 16 countries of the region (including among others Bosnia and Herzegovina, Bulgaria, Croatia, Macedonia, Moldova, Montenegro, Romania, Serbia, and Slovenia) of which 7 are not yet developed with AccorHotels brands.
“We entered most SEE countries this year. However, hotels contracted in 2015 usually would open one to three years after the signature,” Clavie said.
All hotels that Orbis has taken over operate under the AccorHotels brands, of which 38 are operational and another eight projects are in the pipeline, five of which will be franchises, it was announced at the time of the transaction.
With regards to the eight projects in the pipeline, Clavie said three of them have already opened for business - Mercure Bucarest City Center, Ibis Skopje and Ibis Sofia Airport, and the remaining five are either still under negotiation or have been dropped as they do not fit within the company’s development strategy.
“Our Master License Agreement with AccorHotels for 16 countries of the region includes seven where AccorHotels brands are not yet present. In our perimeter we do plan to open more than one hotel per month in 2016,” Clavie said.
“We are yet to enter the markets of Bosnia and Herzegovina, Montenegro, Slovenia, Croatia and Serbia. We do in-depth analysis of particular projects and cases and will enter those markets only when we see satisfactory business opportunities,” the official added.
Orbis predominantly pursues an asset-light model for development, expanding its network through partnerships with franchise and management contracts.
“In specific locations, and wherever it is viable, we may consider developing through our own investments and buying existing hotels or building new ones from scratch,” Clavie said.
The Orbis Hotel Group is the largest network of hotels in Poland and in Eastern Europe, comprising more than 100 properties. It offers a total of nearly 19,000 rooms. The hotels operate under the brand names Sofitel, Pullman, MGallery, Novotel, Mercure, ibis, ibis Styles and ibis budget.