Local press articles have stressed that dramatic change is shaping hotel activity in Russia. According to the forecasts of the Moscow City government, the number of the visitors of capital will quintuple - from one million in 2002 up to five millions people by 2010 The anticipated growth in arrivals to Moscow will inevitably create serious room stock deficiencies among city centre business hotels. On the other hand, this vacuum in accommodation supply will generate strong impetus to promote this sector of commercial real estate, which up to now, has been superseded by lucrative residential, office and retail development, with prime emphasis on Moscow and Saint Petersburg. Whilst there has been substantial curbing of inflation, market stability, greater availability of debt financing for high volume projects and a general rise in demand for accommodation in Russia's main cities, it becomes clear that such factors are conducive to making the hospitality business more attractive to local and foreign investors.
To assist in the development of hotel projects, the preliminary steps will require fundamental market research, sound feasibility studies and legal parameters pertaining to each site under consideration. Common project development methodology among foreign and domestic financial groups reveals, that the majority of investments funding in the real estate projects is supported by detailed financial analysis resulting from project conceptualization, site evaluation, macro and micro market conditions. The analysis of the regional hotel market must also consider important factors such as competitors, positioning, evolution of hotel supply and envisaged demand for the proposed project. Moreover, a solid and reliable feasibility study rests on its capacity to thoroughly assess the impact that the proposed project would have on the existing market and the project's chances of quickly becoming a high yielding investment.
Our company, Hotel Consulting and Development Group has been active on the hotel market of Moscow since 1996. We possess the required consulting skills and expertise used in Russia and abroad for the realisation of market research, financial feasibility of hotel projects, estimation of market value of hotel assets and preparation of investment proposals. We have consolidated broad knowledge in these fields to develop a project from an idea to the preparation of a fully documented business plan, including concept definition, space allocation, hotel management contracts and other considerations applicable to the respective market under investigation. These carefully prepared documents greatly service potential investors by enabling them to attract debt and equity financing for hotel objects in Russia and CIS countries.
We look forward to working with you,
Alexander L. Lesnik,