Of MICE and management

The 7th hotel investment conference organised by Eurobuild Conferences took place on May 12th, 2016 at the PGE Narodowy centre. More than 150 market players were in attendance – hoteliers, investors, local authorities, bankers, MICE sector representatives, owners and managers

The topics that those present were eager to discuss included the strategies of hoteliers, the state of the hotel market and the development directions for tourism in Poland. Those from the banking sector went through the financing possibilities, while the fiscal experts discussed tax optimalisation. For the market to expand, regional development is needed together with the promotion of cities and tourist areas, argued Alex Kloszewski, the managing partner of the main partner of our event,Hotel Professionals – a company that provides advice for the management of hotel market development processes. Tetris, Astralpool, Everest Climbing and AHR Global were the sponsors of the conference. MDDP was the merit partner of the conference, while Ilumio was the technological partner. The eight panels during the conference covered all the aspects of successful hotel investment. The first panel, ‘the general condition of the hospitality and tourism sector in Poland’, began with a presentation on the outlook for the Polish economy and growth forecasts for the Polish hotel, hospitality and tourism sectors. As Alex Kloszewski of Hotel Professionals pointed out, the hotel sector is in rude health and set to grow further. However, for the hotel business to improve, the promotion of our cities and resorts is needed. And for Warsaw a real congress centre for the city is essential. The MICE sector has given a clear boost to the hotel sector’s results in other cities, such as Katowice and Kraków. Bank Pekao, Alior Bank, MBank of Commerzbank Group and Bank Zachodni WBK agreed during the next panel that a hotel project, in order to receive financing, has to be good one and the partners need to have a track record of success in the hotel sector. If not, an investor has to have substantial funds of its own to cover the project. Justyna Bauta-Szostak, a lawyer and partner of MDDP, said that possibilities exist to lower the tax burden on the hotel business. Of course, this can make the business a bit more profitable, but the panellists cautioned that you have to be aware that a hotel is a long-term investment that has to be costed for as long as even twenty years ahead. Although hotel owners hope to be paying less in taxes, there are plans to add some kind of tourist levy as a contribution to regional promotion. The discussion between The Pomeranian Regional Tourist Organisation, the deputy mayor of Warsaw, representatives of the Intercontinental Hotels Group and Marriott International chains and Centrum LIM, concluded that regional authorities and organisations should not be focused on promoting hotels or Poland as a whole, but specific regions and cities as tourist, business or congress venues. And what would be the best environment for hotels to thrive in? One with extensive MICE infrastructure. One example that was cited was that when it was announced that the ICE Kraków congress centre was to be built, it prompted the development of five hotels in the neighbourhood. And if such a hotel is afraid of a hundred of guests turning up all at once, new automated technology is at hand, such as the Ilumio system and an app developed by Ailleron that includes TV and in-room entertainment, an interactive guest service, a mobile concierge, promotional tools, video chats with the concierge and in-room automation control together with light and temperature control. It seems like running a hotel has never been easier, but the main issue lies in making sure you have the right design, as was pointed out during the final panel, on the design-and-build approach to hotel development. All of the panellists, who were managers, architects, advisors or contractors, agreed that it is essential duing the designing of a hotel to liaise with the future operator, since such chains know best what would be good and efficient for the hotel and its users. And cooperation between all those working on the project is also necessary. Otherwise, the hotel will not achieve the required occupancy levels and the operating costs will be too high. An investor who does not know anything about the hotel business cannot simply neglect to provide amenities such as a proper cloakroom for conference guests, catering areas and facilities for the disabled. So far, those attending the conference could say that they had learned how to build a successful hotel and profit from it. But what if an investor was interested in a slightly different kind of project? There many different possibilities to look at, since the housing and hospitality market is quite wide and varied. As well as apart-hotels, condo-hotels and apartments for rent, the opportunity also exists to invest in senior and student housing. In Poland, the first few such projects for the elderly are already operating, while the first private investors are building student halls. The professionals and experts present unanimously agreed that both markets possess significant potential and are worth investing in. In conclusion it seems that the entire hospitality market in Poland is going from strength to strength and that we should expect positive changes and new players to appear in the near future. And, in all likelihood, hotels are set to play a starring role on the Polish market this year.