Rotana Hotels checks into Moscow hotels – Kommersant FM

Players from the Middle East have begun to enter the Russian hotel market. The operator Rotana Hotels from the United Arab Emirates will take control of two properties in the capital, Vedomosti reports. We are talking about 4-star hotels that previously operated under the Holiday Inn brand. The British company left the country in 2022 due to sanctions from the UK, US and EU.

Will the Russian market be of interest to other foreign players? And will the industry benefit from this? Managing partner of Ivashkevich Hospitality Stanislav Ivashkevich believes that for now the effect will not be strong, since Asian and Middle Eastern brands are little known in the country:

“In Russia, no one knows Rotana. Franchising them is certainly an interesting exercise, and we’ll be seeing how the brand itself develops here from a marketing perspective in the near future.

First of all, you need to figure out how to promote it: through what channels, resources, with the help of which tour operators, consultants, promotions. This is a fundamental point that stops the development of any foreign player who is well represented in the eastern part, but not in the western part.

Not everyone is technically and mentally ready to come out here. They will actually have to explain for quite a long time that they are able to provide the service that they and our clients expect at the proper level and of the proper quality. In Russia, 70% of hotel guests are Russians, and 30% are foreigners.

At the same time, I would not talk about the benefits yet, because if this is a classic scheme for signing a management agreement, then basically all the costs of promoting this brand will fall on the hotel owner. And it is necessary that in the next, probably, a year or two, all irons will say that this is a high-quality product, safe and comfortable.”

The Rotana brand currently operates in the Middle East, Africa and Eastern Europe, managing and owning hundreds of hotels. According to Kommersant FM’s interlocutors, the company has been trying to enter the Russian market since March 2022.

Middle Eastern companies focus primarily on their compatriots who come to Russia, says Vadim Prasov, vice-president of the Federation of Restaurateurs and Hoteliers. In his opinion, mass expansion of hotel brands into the country is unlikely to be expected:

“This is a relatively promising project. Why “relatively”? Because it is quite obvious that the flow of guests from the Middle East will probably be the main one. And it’s clear that they know their regional brands better.

The question is: how long will the company come to Russia? Here each owner decides for himself. It is possible that this can be seen as a long-term strategy, given that sooner or later the situation will change and global brands will return.

At the same time, the flow of visitors from the Middle East will remain stable, and perhaps guests will prefer the very hotels that are now starting to operate under these brands. Meanwhile, I don’t think that this is some kind of global story. It was expected.”

Another hotel chain that has started business in Russia over the past year and a half is the Thai Dusit. It is expected that she will manage several hotels in the New Sheregesh tourist center, the project of which is still under development.

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Elena Ivanova