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Planned New Convention Center Includes New Hotel

The Attica hotel owners association met with the head of Hellenic Tourism Properties recently to discuss the construction of a convention center at the old Athens International Airport at Hellenikon. When and if completed, the center will accommodate 8,000 participants. A hotel will also be built.

In the meantime, however, hotels in Athens were more than half-empty in November, with occupancy rates at luxury hotels even lower than they were in the same month last year, according to data released by the Attica Hoteliers Association.

According to the data, the average occupancy rates of luxury hotels were 45.4 percent, compared with 51.2 percent in November 2002. Category A hotels’ occupancy rate increased marginally, to 55 percent from 54.5 percent, as did that of Category B hotels (45.3 percent from 44.7 percent). The average occupancy rate of Category C hotels was 41 percent, down from 41.1 percent.

The hotel owners hope to have a very good 2004, thanks to the Athens Olympics. They also say that there is great demand from convention organizers.

The majority of Greek hoteliers are guardedly optimistic regarding industry prospects for the coming years, but a good number of them had expressed concern for the future in a study prepared by the Foundation for Economic and Industrial Research (IOBE).

Concerns focus on strong competition from emerging rivals, such as Turkey, Egypt, Tunisia and Morocco, as well as the traditional rivals like Italy, Spain and Portugal. The study notes that Greece devotes much less than some of its rivals to the promotion of its tourism industry abroad: The Hellenic Tourism Organization devotes a mere 18.7 percent of its budget to advertising, compared with 35.7 and 83.7 percent by the respective organizations of Italy and Portugal.

Members of the industry also cite still inadequate infrastructure; the absence of specialized regional agencies for planning, marketing and promotion of the industry; the low quality of training; the excessive negotiating power of tour operators; a large number of unregistered accommodation facilities and a lack of consistency in service.

According to the IOBE study, overnight stays rose by an average annual rate of 5.1 percent in the 1996-2001 period. August and July were the most popular months, with 20 and 17.5 percent of overnight stays respectively, while December and January lagged with 1.8 percent each. The southern Aegean region accounted for 27 percent of overnight stays, followed by Crete with 20 percent, Attica with 13 percent and the Ionian Islands with 11 percent.

The number of arrivals from abroad grew at an average annual rate of 4.3 percent in the 1990-2001 period, but when immigrant traffic is excluded this percentage drops to about 3.4 percent.

UK and Germany are the main countries of origin of foreign visitors, with 23 and 20 percent respectively in 2000. Italy, the Netherlands and France followed with much lower rates.

The study says that the hotel industry’s short-term and long-term financial situation is not satisfactory, arguing that enterprises face liquidity problems and inadequate return on capital employed in the 1997-2001 period.

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