The newly opened Park Inn by Radisson hotel in Bucharest, which is managed by the Carlson Rezidor group, has had better than expected results in the first month after its opening. The group, which is best known for its Radisson upscale hotel brand, is now looking to expand its presence in Romania by taking its brands to other larger cities, such as Timisoara and Cluj-Napoca.

The first Park Inn by Radisson hotel opened in Bucharest on September 1 this year, following the reconversion of part of the Centre Ville apart-hotel complex owned by local company Bucuresti Turism, which also owns the adjoining Radisson blu hotel. The renovation took seven months and the total cost amounted to over EUR 6 million.

The new hotel has 210 rooms and one- or two-bedroom apartments classified at four stars, and targets both business and leisure travelers, with a focus on longer-term stays.

“We’re pleased with the way the hotel has opened and with the fact that within three weeks since the opening we’ve had several nights when all the rooms and apartments were fully booked,” said Bert Fol, general manager of the Radisson blu and Park Inn hotels in Bucharest.

“These results make us believe that the new Park Inn by Radisson will lead the mid-market hotel segment in Bucharest, and I’m confident that with two flagship hotels in the capital city Bucharest that we have the opportunity to expand further in Romania and possibly in Bucharest itself,” he added.

According to Carlson Rezidor representatives, Romania and the wider South-Eastern European region (SEE) have good growth opportunities for the hospitality industry, especially for mid-market hotels such as the Park Inn.

“We see a fantastic opportunity to move further and grow our footprint here in Romania. We are looking into other cities as well. We are looking especially into cities like Timisoara or Brasov, Cluj-Napoca, Sibiu, Constanta, Craiova. All have great opportunities for such a brand,” said Arno Schwalie, Area Vice President Central Europe of the Brussels-based Rezidor Hotel Group.

“We are also looking into Bucharest, we have several investors here who are interested in further talks, but it would be great to have a solid presence all over Romania to support our growth in this region,” he said.

Carlson Rezidor is the second international hotel group that has announced plans to expand its presence from Bucharest to other important cities in Romania. One month ago, Polish group Orbis, the regional manager for French group Accor’s brands, announced that it would open two new hotels in Romania, in Arad and Brasov.

What makes Romania an attractive market for the international hotel chains is the strong growth in tourism and the good economic prospects, as well as the low number of international hotels outside Bucharest. Larger cities such as Timisoara, Cluj-Napoca, Sibiu, and others have developed a lot in recent years due to new foreign investments in automotive and other industrial facilities, as well as in the IT&C and support services sectors. With these new investments, the demand for quality accommodation has also increased.

“What we’re seeing in Romania at the moment is very strong and, I believe, overdue growth in tourism which has developed nicely both in the regions and in Bucharest. We’re also experiencing a lot stronger than the norm in Europe in GDP growth and foreign direct investment in the country and I think the outlook in Romania is very positive,” said Bert Fol.

“But the other aspect is the lack of internationally branded hotels outside of Bucharest, which again I think is slightly unusual. Romania is following a global trend where internationally branded hotels are becoming more popular and owners of existing hotels are looking to reflag into international brands. There are also investors who were perhaps considering investments in this sector six-seven years ago, but have put their plans on hold because of the global crisis in 2008. Those investors are again starting to look more carefully at investing in the hotel market in Romania,” he explained.

Romania is following the wider trend in Eastern Europe, where there are more new hotel openings than in more developed regions such as Western and Nordic Europe. Eastern Europe is already second in terms of hotels managed by the Rezidor Hotel Group, with 118 units, just behind Western Europe, where the group manages 119 units, according to Olivier Harnisch, Executive Vice President and Chief Operating Officer of Rezidor Hotel Group.

“This year we open 24 new hotels. Some 90% of our new hotels openings are in markets, such as Eastern Europe, the Middle East and Africa,” Harnisch said. “I’m very sure that in the next couple of years we’ll be able to announce further projects in Romania,” he added.

The Rezidor Hotel Group operates over 430 hotels in Europe, Middle East and Africa while the parent group Carlson Rezidor, which has its headquarters in Minneapolis (US), manages close to 1,400 hotels worldwide, which generate annual revenues of some USD 35 billion.

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Andrei Chirileasa, andrei@romania-insider.com