Demand on Hotels Increase

TaTa Toria

“Intercontinental”, “Hayatt”, “Kempinski” – these are brandies scheduled to enter Georgia`s market of hotels in up-coming future, what should obligatory be appreciated.

Competitiveness will increase, in accordance with service improving and prices regulation. Service of Georgia`s hotels will be presumably improved, but the services do not require international standards yet. According to “Sheraton Metekhi Palace” hotel Realization and Marketing Division Manager – Tamuna Guledani, Georgian hotels do not require the world standards, but several meet some requirements – “Tori”, “Varazi”, “Vere Palace” and “Best”. Others have no status of hotels. We have “guest houses” hosting to many guests.
Stars confirming on hotels remains unordinary, but intensive negotiations concerning Hotels Association creating are under the way. The Association ` s goal scheduled to be controlling over the hotels, to be met by world requirements and maintain developing of Georgian hotels.
According to Tourism and Restores Department Deputy Head Bakur Lashkarava, the association will maintain stars confirming on the hotels, never being regulated by any. Each hotel in Georgia confirms on the stars as it wishes, but the world practice faces the opposite – in every country there are independent branches regulating the issue. It should be noted, that in Europe there are hotels, not coming into correspondence with confirmed on status, as for instance five stars hotels are often three stars in reality. Government is not sharing in service issues. We hold meetings with hotel officials, and negotiations concerning Hotels Association creating are under the way.
Hotels market sensible growing is faced during last three years period. Provided researches in hotels` sphere show that demand on market importantly increase. According to Marketing Center “IPM” provided research, all sort of non- living, commercial, office areas and hotels have been described. Future perspectives scheduled to be realized, have been among the researched issues. The research faced, that the highest competitiveness was expected between office areas, and the lowest between commercial areas. IPM Real Estate Manager Kote Gabrichirdze said that investing was the most profitable in hotels business, because of expected low competitiveness. Seventy – five hotels were running in Georgia, including 1447 units of rooms, and 2676 beds, according to provided researches in 2005.
The condition radically changed in 2006. Competitors entered the market and new proposals had appeared. According to 2006 Statistic Department dates, Georgia had 395 acting hotels including – 8,9% state property hotels, 91,1% (327 hotels) real property. 96,3% of private hotels were owned by physical and juridical individuals, and 3,5% were owned by foreigners.
Whole income of the hotels in 2006 included GEL 107,0 millions (without VIP and shares). 53,0% of incomes were got from using of rooms, 20,7% from restaurants, bars and other services, 7,9% from fixed capital, 0,2% evaporated people service, and 17,3% from other services. The expanses of the hotels included GEL 125,8 million, including salaries of serving personal GEL 15,0 million (11,9%), number of employees at the hotels approached 4732, including 2634 (55,7%) women.
Number of guests included 217095 in 2006.Among the visitors 24,9% were guests, 49,9 % professional and business visitors, 1,0% passed healthcare procedure, and 24,9% other visitors. Georgian citizens number included 37,9%, foreigner number – 62,1%.
The number sensibly increased for today, according to Bakur Lashkarava. Description of hotels, restaurants, entertainment centers museums, squares and tourism infrastructure had taken place all over Georgia, under supervision of the Department of Tourism. If there were 395 acting hotels in Georgia, including 15000 beds, the number increased with 500 unites, so the number of beds grow. As Mr. Lashkhava told, the main goal of the issue is hotels` number rising and beds` number increase, for tourism development and attraction of foreigners.
Intensive work is under the way concerning demand increasing on hotels located in Tbilisi, Ajara, Svaneti, Shatili, Borjomi, Bakuriani, Gudauri and Bakhmaro. New products and service is scheduled to be inculcated following intensive marketing company providing.
It should be outlined, that no one international network is interested in hotels business running in Georgia. Constructing of six or seven huge hotels is planed in Georgia, presumably to be followed with construction of smaller hotels.
If the project, being under the negotiation for today, will appear on Georgian market, such huge companies as “Hayatt”, “Kempinski”, and “Intercontinental” will really enter Georgia`s market and we will have big proposal on constructing of the hotels. Our hotels are overloaded with 95-96% for today, when the norm is 60% in Europe, but the situation will be balanced after. After these hotels will appear on the market the prices in our hotels will reduce. Our hotels suffer record high prices, being established by the owners. Besides, the products are selling, because there is not big variety on the market. But competitiveness may provide “falling down” of the market, market will be able just endure gradually coming into exploitation of new hotels, for instance, one hotel per six month or a year, but appearing of three, 300 rooms hotel on the market at once, will really be a catastrophe.
Mr. Bakur Lashkarava said, that non- correspondence of prices and services causes are not enough supplement of the market. Most of Tbilisi hotels (90 -95%) make accentuate just on filling the hotels and do not care about service improvement issues. Several huge hotels network will enter our market in up-coming future and exact projects are already scheduled as in Tbilisi as well as in Ajara and other regions of Georgia. Prices will reduce as soon as demand – supplement will be balanced. Caring about the service will become a task of hotels owners.
Demand on hotels rises in Georgia; the same tells “Sheraton Metekhi Palace” Realization and Marketing Manager Tamuna Guledani. Tbilisi hotels have enough number of rooms, but it were seasons when there was no free room in Tbilisi, she said. Mrs. Guledani hails entering of new brandies Georgia`s market, the hotels will obligatory meet requirements of international standards and maintain controlling of the prices. There are no hotels to be compared to each other for today. We have “Sheraton Metekhi Palace” and “Marriott” and clients have to choose one of them. Guledani believes, Georgia`s market will “endure” entering of new brandies and gradually inculcation of new hotels in our country.
Entering of new brandies is appreciated by “Courtyard Marriott” manager Maya Tsereteli. Huge accentuate is making on tourism development, for today, she says. Every sort of problems will be resolved by the market itself.
New hotels constructing trend in Georgia should obligatory be appreciated, but all hotels scheduled to be five stars. According to Kote Gabrichidze, the lowest level hotel scheduled to be built – is four stars. No one thinks about middle level hotel constructing. Five and four stars hotel can not maintain mass tourism development (not mentioning business and conference tourism). It mentions so called tourism circle creation, hosting to 100 tourists per week. But tourism will not be able condition endurance when prices of room in hotel includes at least USD 100. In Georgia, we have just one sort of tourism – business tours, but we are really far from massive tourism. That` s why it is obligatory to construct three stars hotels. According to Mr. Gabrichidze, serious calculations making and research of the market providing in necessary. But all these will be created possible just after acting plan scheduling, conception preparing and exact projects determining. For, instance if the government will project 10 billion budget for 2015, 2 billion should be separated for tourism sphere development. Marketing researches are under the way for today. Following 2010 budget scheduling, Department of Tourism may schedule exact goals. It`s necessary different sort of tourism development – bike tourism, hunting tourism and ect;
For developing of bike tourism, two and one star hotels will be quite enough, because such tourist will not stay in four stars hotel, not depending, he is a millionaire or not. He does not need comfort, because aim of his visit is looking around a wild nature.
Just business tourism exists in Georgia. But other directions of tourism are easy to be developed, Tamuna Guledani said. It requires middle level hotels constructing and Tbilisi first of all needs three stars hotels existence. Mrs. Guledani believes, “Intercontinental”, “Hayatt”, and “Kempinski” are luxury five stars hotels and not determined for all tourists.
As Mr. Bakur Lashkarava says, most of five starts brandies owners have two and three stars hotels network. It` s doubtless, that Georgia has big tourism future and high prices proving high demand.
Skilled personal is very important issue. According to Mr. Lashkharava, tourism schools are scheduled to be opened soon, with the assistance of Greece government. The schools will be as strong base in Caucasus region, as well as outward of it. Serious agreements have been made with European schools. Re- training programs providing under middle business development and employment frames is hugely important.