Hoteliers in the Athens area continue to face painful economic problems and some even face extreme difficulty when it comes to paying running monthly expenses. They say the strong investment in modernization carried out prior to the 2004 Athens Olympics, in conjunction with post-Olympic drop in arrivals, places them in an almost dead-end situation.
Last year’s Athens Olympics Games disappointed Greek hoteliers and last month’s figures from the Attica Hoteliers Association show that the Games failed to generate anywhere near the windfall revenues many had hoped for in 2004.
Although Greek authorities are still to release tourism arrival figures for 2004, the association’s monthly newsletter said that occupancy rates for the capital’s hotels remained unchanged last year from the 2003 level, at about 50 percent.
Hoteliers admitted that the Games did generate the year’s highest occupancy rate, at about 77 percent during August, but that was because the Games’ organizers had booked about 90 percent of the rooms in the Athens region for officials. Available data shows a sharp slide in occupancy rates during the post-Olympics period.
Data from the Attica Hoteliers Association, which was complied in cooperation with JBR Howarth, show Athenian area hotels with the lowest occupancy rate (56.5%) in Europe and the lowest average room rate, 61.20 euros, when compared with Europe’s other capitals.
These economic results come at a time when hotel occupancy has fallen by some 7% over 2003. Hoteliers add that room rates in real figures have dropped over the same period by some 10%. At the same time, their costs have risen appreciably due to loans acquired to cover the costs of extensive renovations carried out to ready for the Games.
The above, say hoteliers, have caused many in the sector to engage in price wars in an effort to pull in enough cash to pay immediate expenses.
According to recent press reports, the capital’s bigger hotels face the biggest problems as they have paid out considerable sums for renovation. Over the past few years, Attica area hoteliers have spent more than 1.5 billion euros in renovation works.
Yet, according to Hellas Bank, the country’s 100 biggest hotel units posted sales of 983.7 million euros in 2003 when their total debts reached 1.8 billion euros.
Tourism accounts for about 18 percent of Greece’s gross domestic product, and the government is aiming to increase that figure to 35-40 percent over the course of the next decade. In order to attract more tourists, the government launched a 30-million-euro advertising program promoting Greek attractions this year.
The industry, which attracted just under 14 million tourists in 2003, according to estimates, employs around 800,000 people out of Greece’s 10 million population. The Hellenic Tourism Organization has yet to release arrival figures or estimates for 2004.