REBEC 2025: Regional hotel sector – “An underrated artist who played in small pubs for years”

The hotel sector in the Southeastern European region is developing at an ever-increasing pace. More and more well-known global brands are entering the regional market, especially in the surrounding coastal countries, which are becoming increasingly attractive to foreign tourists. Not only hotels, but also apartments and condominiums are being built to meet different needs and demands, but also because many investors see such projects as more profitable in the long term.

How the growing momentum in the hospitality industry affects the development of local communities in the region, how sustainable are the projects currently being developed, what priorities are in the focus of brands coming or already operating in this region, what are the priorities of investors and whether there is an appropriate balance between them, as well as what are the prospects for the development of this sector in the coming years, these questions were given insight into at the panel “The most important tendencies in the development of the hospitality industry in the region” held as part of the REBEC 2025 conference.

Nicholas Dimopoulos, Development Manager for Greece, Italy and Cyprus at Wyndham Hotels & Resorts, believes that Southeast Europe in this area has been like a kind of underrated artist who has been playing in small pubs and small venues for years, and suddenly everybody realizes that they are talented and everyone wants to have a ticket to their concert.

– That’s how it is with Southeast Europe now. We have the landscape, the food, the culture, it’s all here. So, right now, Southeast Europe is not just a poor cousin of the rest of Europe and a cheap alternative to other European destinations. It is a destination where one can live and experience depth. Culture, places, people. So, yes, the potential is here. But, of course, there are many things that are holding us back at the moment. Things like delays in issuing permits, bureaucracy. Also, another big problem is the perception of Southeastern Europe towards the West, the perception of political and managerial instability. That is a big problem. Things are getting better, but... – Dimopoulos points out in the panel moderated by Kristina Milin.

Majlind Lazimi, Managing Partner at Horwath HTL from Albania, speaking about investments in this area, believes that in recent years, many construction companies that were investing in real estate, in terms of residential and commercial buildings, have diversified their portfolio and basically expanded their investments into hotels.

– Today, we see that some of the construction companies that used to really only have 100% residential units, are now thinking in terms of mixed-use resorts. And I think that the government has, to some extent, put tourism development on the public agenda. So, I think there has been some coordination between the public sector, the government agenda and the interests of the private sector. And obviously, the second thing is the sustainability and visibility of the projects. Also, the brands were quite interested in actually entering the new market. Obviously, there are a lot of challenges, bottlenecks, I would say, especially when it comes to regulation and master plans. But again, in general, I think more and more Albanian local investors understand the bigger picture – Lazimi explained how he saw the current developments and processes, using the example of Albania.

In his opinion, it all boils down to the relationship between investors and brands that come to the market.

– Here we also have to think about other things, for example, to create a good enough infrastructure. When it comes to challenges, I think that one of them is how ready we are, and I mean not only Albania, but even the region, to expect such a large influx of tourists, which is especially felt at the airfields during the summer. The question is, do we have enough capacity? Do we have enough hotel facilities? Do we have enough staff? Because it is another challenge, the challenge of human resources will be quite crucial for further developments and further projects in the hospitality industry. That's why I think we have to be careful about the challenges, but at the same time we have to celebrate this great achievement of the last four or five years – he noted.

Kruno Santini, Head of ECM Adria Region, believes that if a country or a market has a well-designed offer, the attractiveness of the market is definitely there.

– So, if the project itself is taking place in the right micro-location, if its best use concept is there, that's one of the key things. I think brands can really find themselves in such a story. I would say that the hospitality real estate sector is attractive at the moment and will remain attractive. I definitely think that preparation, finding local knowledge, finding a local partner is key – he pointed out.

Dimopoulos noted that they were trying to provide investors with greater long-term value and flexibility, while Lazimi stated that the mindset of investors must be understood, especially since most of them were construction companies.

– The return on investment in nine or ten years is one of the reasons why they always try to have a residential commercial component in addition to the hotel – he emphasized.

The panelists also pointed out that there had been a recent increase in the interest in this market even from international investors, mainly from the Middle East. The interest of brands and investors in this region is good, but they agreed that it was necessary to simultaneously think about the development of sustainable tourism. This is not easy if we know that investors want to have a return on investment in the next few years, and not wait a decade. Therefore, they assessed, it is important to work on educating investors.

One of the good things in this process, they stated, is that international investors are joining forces with local investors on certain projects. However, they warn, tourism should not only be about attracting foreign tourists, but care must also be taken to best align the lives of the local population with their expectations, without countries in the region becoming like Italy and Spain, where due to the huge number of tourists, the local population no longer feels comfortable during the tourist season.

The panelists’ advice to investors and brands who want to be present in the markets in our region is that, before entering a new market, they should first try to understand the context, that brands should cooperate with local investors, and that international investors should identify the right local partner, the right mindset, the right financial and investment perspective, which would be long-term.

The lessons learned in this region indicate that you should never underestimate local knowledge and experience, because in every project, success is not based on something that was designed somewhere abroad, somewhere outside, but is based on listening and following the needs and lifestyle of each region, including ours. One of the conclusions of the panel is that you should listen, listen to clients, but also understand the local market and the environment, trying to accept the local environment.

D. A.

Festlent d.o.o. Beograd

Horwath HTL d.o.o. Beograd

REBEC

REBEC 2025

Windham Hotels and Resorts

ECM Adria region

Horwatah HTL

Nicholas Dimopoulos

Kruno Santini

Majlind Lazimi

Kristina Milin