Investors are in negotiations to bring the first global quality-class hotel chain to the Ukrainian market with the aim of filling massive demand.
Investors are in negotiations to bring the first global quality-class hotel chain to the Ukrainian market with the aim of fiilling the massive demand for low cost accommodations.
US-based Wyndham Hotel Group announced in late January it will team up with Ukrainian Hotels LLC, a subsidiary of developer AstronUkraine Corp., to construct 15 Ramada Encore hotels over the next decade.
Wyndham’s entrance onto the Ukrainian market is expected to significantly boost the hotel industry, whose underdevelopment is viewed as the main tourism hurdle and a key challenge ahead of the UEFA EURO 2012 football championship.
Wyndham Hotel Group seeks to make Ramada Encore hotels the midscale lodging leader in Ukraine’s key secondary cities within the next five to seven years, said Olivier Dupont, Wyndham Hotel Group International senior vice president of international development in Europe, the Middle East, Africa, and Asia Pacific.
Plans envision that more than $150 million will be invested into developing the chain.
“The existing infrastructure of Ukraine’s hotel market does not satisfy demand, neither in terms of quantity nor quality,” said Geoffrey Cox, president of Astera, an international company that renders professional service in the commercial real estate sector.
Astron decided to back the project after being convinced the Ramada Encore model will succeed in Ukraine, said Serhiy Kozhukhalov, executive coordinator at Ukrainian Hotels LLC.
Its boutique design is “unique for the midscale segment and will allow us to exceed the expectations of our clientele at a competitive price,” he added.
Wyndham Hotel Group, headquartered in Parsippany, New Jersey, manages nearly 6,500 hotels globally.
While Wyndham is leasing the Ramada franchise and Astron is handling construction, the project’s investors are an anonymous group of Ukrainian and international businessmen, Kozhukhalov said, decling to reveal the investors “as that is confidential project information.”
The threestar hotel market offers immense potential for expansion and guarantees a return on investment within seven years, Kozhukhalov said.
Currently, only two hotel chains are on the Ukrainian market.
Premier Hotels (Premier International Ltd.) owns the luxury Premier Palace in Kyiv, the Oreanda in Yalta, and the Dnister Hotel in Lviv. The group also has hotels in Odesa, Mukachevo, and two in Kharkiv.
Poland’s largest hotel network, the Orbis Group, opened two economyclass hotels in western Ukraine during the past year.
Plans envision Wyndham hotels emerging in cities with populations of more than 200,000, according to Kozhukhalov.
Currently, Kozhukhalov is negotiating land purchases. Construction of the first hotel is expected to start late this year.
Each Wyndham hotel will have between 80 and 200 rooms, with an average area of 3,500 square meters.
All rooms will be equipped with showers, Internet access, work areas, directdial telephones, tea and coffee options, and flatscreen TVs with satellite service.
A professional Wyndham team with international experience, which the company certified for work in Central and Eastern Europe, will manage Ramada Encore in Ukraine.
