Hotel & Motel Management - December 8, 2008 - (Page 33) www.HotelMotel.com/digital_edition HotelMotel.com | H&MM December 8, 2008 News 33 Russia/CIS Continued from page 1 best case [gross domestic product] for Russia in 2009 will be about 5.5-percent [growth]; the midcase might be about 5 percent; and the worst case—depending on the world—might be just over 4 percent.” Thorniley said a 4-percent GDP growth would be painful for Russia, but hoteliers needed to realize that China’s growth will plummet from 10 percent to perhaps 7.5 percent, and even those numbers will be five to 10 times what Western Europe and the U.S. will see. He said the U.S.’s mid-case is zero growth; its worst case is a 1- or 2-percent decrease; and the U.K. is looking at a difficult next 12 to 18 months. “However tough business will be in Russia and Central Europe over the next 18 months, you can always be happier that somebody doing business in Germany or France or Spain or Japan or America or Latin America will be doing much worse,” Thorniley said. a lot of work to do,” Fuller said. Red tape woes Many speakers, including Erkan Erkek, CEO of Capital Partners, addressed concern at how much red tape is involved in opening a new hotel in Russia. “Part of the process is very complicated and unclear. In any major city of the world, to do a project of this size [The Ritz-Carlton, Mos- cow], you would have some major challenges; but the challenge here is that you don’t know what is going to happen,” Erkek said. Patrick Fitzgibbon, SVP of development in Europe & Africa for Hilton Hotels Corp., said many governments provide tax incentives, but that’s not what’s required in Russia. What is required is speeding up the process so companies can finish develop- ments in a timely manner. “I still think that one of the single biggest problems we see in our development is the permitting and approval process. If the local government [wants to get involved], that’s where we would encourage them to focus,” Fitzgibbon said. There are no easy fixes, according to Erkek, who said the luxury market will stay strong for both Russia and Kazakhstan. “You need a long-term vision. Return on investment in this mar- ket is seven to eight years if you are lucky and you don’t make mistakes,” he said. “While each country has its unique challenges, [you have to] be sensitive to those challenges in that market, taking the time to understand that market, have our developers work with the [local] people and actually spending the extra time up front,” Fuller said. “If you take things for granted, you’re going to run into problems.” pheney@questex.com More Than Ever You Need Information and Insight To Chart Your Course. NOW A profitable market Thorniley noted that profitability is good in Russia, and it is probably in the top three markets for premium pricing in the world. “Russian consumers understand quality and will buy quality,” he said. “So you can charge … premium prices for good-quality products in this market probably more than anywhere else in the world.” According to Arthur de Haast, global CEO of Jones Lang LaSalle Hotels, this is due to strong demand and little supply. But he noted occupancy in Moscow is at best in the mid-60-percent range, so the city still has a lot of upside potential from the demand side. Ed Fuller, president and managing director of international lodging at Marriott International, said while Russia doesn’t currently have the dynamics of India or China, the region is very much in the company’s sights. “Clearly, Russia and the CIS to us looks to be a very strong area from the perspective of opportunity for multiple brands, be it the luxury Ritz-Carlton, JW Marriott, the quality-tier Marriott and Renaissance or the moderate-tier brands. We believe this is still an untapped market [where] we have Hunter Hotel Investment Conference A Hotel Real Estate and Finance Conference Designed for Today’s Hotel Owners and Investors FOUNDERS: Hunter, Hotel Brokers Since 1978 Georgia State University J. Mack Robinson College of Business, Cecil B. Day School of Hospitality PREMIER MEDIA SPONSOR: Hotel & Motel Management SPONSORS: America’s Best Franchising Best Western International Capmark Finance, Inc. 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Table of Contents Feed for the Digital Edition of Hotel & Motel Management - December 8, 2008 Hotel & Motel Management - December 8, 2008 Contents Best Western Sets Spending Strategy Courtyard Turns 25, Unveils New Lobby New Division of MGM Goes Beyond Gaming Perspective Legal FAQ Marketing Matters Family Business On Finance AAHOA Update Satisfaction Trends HotelWorld Update Consultant’s Corner Trends & Stats IH/M&RS Editors’ Choice Award Winners Insurance Ad/Editorial Index Marketplace Classifieds Checking Out Hotel & Motel Management - December 8, 2008 Hotel & Motel Management - December 8, 2008 - Hotel & Motel Management - December 8, 2008 (Page 1) Hotel & Motel Management - December 8, 2008 - Hotel & Motel Management - December 8, 2008 (Page 2) Hotel & Motel Management - December 8, 2008 - Contents (Page 3) Hotel & Motel Management - December 8, 2008 - New Division of MGM Goes Beyond Gaming (Page 4) Hotel & Motel Management - December 8, 2008 - New Division of MGM Goes Beyond Gaming (Page 5) Hotel & Motel Management - December 8, 2008 - Perspective (Page 6) Hotel & Motel Management - December 8, 2008 - Perspective (Page 7) Hotel & Motel Management - December 8, 2008 - Marketing Matters (Page 8) Hotel & Motel Management - December 8, 2008 - Marketing Matters (Page 9) Hotel & Motel Management - December 8, 2008 - Family Business (Page 10) Hotel & Motel Management - December 8, 2008 - Family Business (Page 11) Hotel & Motel Management - December 8, 2008 - On Finance (Page 12) Hotel & Motel Management - December 8, 2008 - On Finance (Page 13) Hotel & Motel Management - December 8, 2008 - AAHOA Update (Page 14) Hotel & Motel Management - December 8, 2008 - AAHOA Update (Page 15) Hotel & Motel Management - December 8, 2008 - Satisfaction Trends (Page 16) Hotel & Motel Management - December 8, 2008 - HotelWorld Update (Page 17) Hotel & Motel Management - December 8, 2008 - Consultant’s Corner (Page 18) Hotel & Motel Management - December 8, 2008 - Consultant’s Corner (Page 19) Hotel & Motel Management - December 8, 2008 - Consultant’s Corner (Page 20) Hotel & Motel Management - December 8, 2008 - Consultant’s Corner (Page 21) Hotel & Motel Management - December 8, 2008 - Trends & Stats (Page 22) Hotel & Motel Management - December 8, 2008 - Trends & Stats (Page 23) Hotel & Motel Management - December 8, 2008 - Trends & Stats (Page 24) Hotel & Motel Management - December 8, 2008 - Trends & Stats (Page 25) Hotel & Motel Management - December 8, 2008 - IH/M&RS Editors’ Choice Award Winners (Page 26) Hotel & Motel Management - December 8, 2008 - IH/M&RS Editors’ Choice Award Winners (Page 27) Hotel & Motel Management - December 8, 2008 - Insurance (Page 28) Hotel & Motel Management - December 8, 2008 - Insurance (Page 29) Hotel & Motel Management - December 8, 2008 - Insurance (Page 30) Hotel & Motel Management - December 8, 2008 - Insurance (Page 31) Hotel & Motel Management - December 8, 2008 - Insurance (Page 32) Hotel & Motel Management - December 8, 2008 - Insurance (Page 33) Hotel & Motel Management - December 8, 2008 - Ad/Editorial Index (Page 34) Hotel & Motel Management - December 8, 2008 - Marketplace (Page 35) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 36) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 37) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 38) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 39) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 40) Hotel & Motel Management - December 8, 2008 - Classifieds (Page 41) Hotel & Motel Management - December 8, 2008 - Checking Out (Page 42) Hotel & Motel Management - December 8, 2008 - Checking Out (Page 43) Hotel & Motel Management - December 8, 2008 - Checking Out (Page 44)
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