All eyes on Turkey

It hasn’t escaped anyone’s attention that Turkey has been a hotbed of hotel development for the last two years, with an increasing number of international brands raising flags all across the country.

This bullish development shows no sign of slowing down in 2012, as developers eye new cities and operators look to bring additional brands to existing markets.

"It is not just about Istanbul, Ankara and Izmir; other cities will boom and demand is there and they need hotel investment,” said Hamdi Akin, chairman of Akfen Holding Company, which owns 10 operational hotels under Accor flags in Turkey and Cyprus, and has at least eight more in the pipeline.



Confidence in Turkey and the wider region was high at the annual Central Asia & Turkey Hotel Investment Conference (CATHIC), which took place this week in Istanbul.

On a high-profile discussion panel, industry leaders spoke of their positive outlook for the hotel sector, particularly in Turkey, where a growing middle class and expanding population is creating demand for quality mid-range hotel accommodation.

“Travellers are spending a lot less these days. We should believe in the mid-market sector as it is the most profitable,” said Kurt Ritter, CEO of Carlson Rezidor Hotel Group.

Wyndham Hotel Group CEO Eric Danziger concurred: “There is a danger in putting the wrong brand in the wrong location, for instance if the market can't afford it. If the objective is to be profitable then the mid- and budget sectors have many more opportunities right now.”

But although demand for mid-range and budget hotels is high, many international operators are still keen to raise at least one luxury flag in Turkey.

Mandarin Oriental announced plans this week to open a hideaway resort and residences in Bodrum in 2014, while Hilton Worldwide signed agreements to open four new hotels in Turkey during CATHIC, bringing the total number of hotel developments in the pipeline to 13.

Turkey has seen tourist arrivals surge by more 400% in the last five years, and reported more than eight million visitors in 2011. That figure is predicted to almost double again by 2015, as more hotels come online, a new airport opens, and the visa application process is simplified.