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Best Western to expand despite market slowdown

17.09.2008, 16:19 9

International hotel chain Best Western, present on the domestic market with 12 affiliated hotels, wants to reach 20 hotels by 2010 and take its expansion plans further, although the domestic market seems to be slowing down.

This year, Best Western has three affiliated hotels in SIF Banat-Crisana's portfolio, in Baia Mare, Zalau and Hunedoara, and has recently signed a contract to affiliate Stil hotel in Bucharest. The three hotels outside Bucharest were added to the Best Western hotels in Arad, Bucharest, Gura Humorului, Cluj, Constanta, Resita, Timisoara, Lacul Sfanta Ana and Sibiu.

"In Bucharest, we plan to deal our cards again because, for strategic reasons, Best Western Parc will come under Ramada's umbrella. We started by affiliating Stil hotel and we're in talks for another 2 locations. At present, we have 12 units and next year will reach 15-16, with our target envisaging 20 hotels in 2010," said Malin Malineanu, development coordinator of Best Western Romania.

He specified that in the capital city affiliated hotels have a capacity of up to 100 rooms and are located in various areas.

At the same time, in Bucharest Best Western plans to bring Best Western Premier four-star plus brand. Hotels currently affiliated to Best Western are rated as three and four stars.

Other international chains such as Ramada or Golden Tulip are also continuing to expand domestically, particularly focusing on cities with a high potential.

The first signs of a slowdown appeared on the Bucharest market this year. Malineanu says the hotel industry will reach minimal margins in four years, with investments being recouped in 12-18 years. The market slowdown will translate into lower rates on the four and five-star hotel market in Bucharest and in a shrinking occupancy rate for hotels across the country.

According to Malineanu, it is not only the falling travel budgets that prompted this slowdown, but the current state of tourism, as well.

Best Western hotels target both leisure and business traffic, depending on location. Best Western affiliated hotels in 2007 generated turnover worth around 12 million euros, with turnover worth 16m euros expected for this year.

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