From Our Members

The definition of hotel is changing

Ahead of HOTCO 2022, Marius Gomola, co-founder of HOTCO Hotel Investment Platform CEE and Caucasus speaks to Emerging Europe about the most recent developments in the hotel real estate investment industry.

For Marius Gomola, managing director of Horwath HTL Hungary and founder of HOTCO – a hotel investment conference dedicated to Central and Eastern Europe and the Caucasus – the definition of the hotel as we know it is changing.

“We have begun to see the inclusion of multiple uses within the hotel, marrying different motivations to provide the perfect real estate asset mix,” he says. “This includes the combination of co-working, co-living, retail and other experiences within the framework of a building envelope.”

One of the drivers of this change is the increased importance being placed on ESG (environmental, social, governance).

“Our region in particular has to recognise the importance of ESG as it no longer just revolves around sustainability and energy efficiency,” Gomola tells Emerging Europe.

“We need to understand that being ESG compliant is driving investors particularly in their institutional decisions when it comes to the financing of a development. This change in importance has become more apparent over the last years, even though regulatory statuses are still in different stages of completion.”

Making the most of the region’s human capital

Gomola believes that the CEE, SEE and Caucasus regions will continue to attract new investors in the hospitality real estate sector, but stresses that it is essential they understand the complexity of hospitality investments, and recognise that one decision determines the outcome and influences the impact of the next.

“If not executed correctly, uninformed decisions can result in poor investments,” he says. “This is why HOTCO is relevant for investors to learn about the success factors shared by proven investors and adopt them to their own circumstances as relevant in their respective regions.”

One area of concern – which Gomola says will be addressed at this year’s HOTCO event, set to be held In Budapest on May 30-31 – is making the most of the region’s human capital.

“The hospitality industry, especially in this region, has not allowed employees to find a compromise between making a living, taking care of their families or their career plans,” he says.

“This has not only caused a drop in employee numbers but is also forcing a change in strategy; focusing not only on new employees but working especially with retaining current staff. It is no secret that when service providers – the talent and the stars of the service industry – are cared for in a way that matters to them, the bottom line comes with the desired results. This is an aspect often ignored by investors and operators and has to be urgently addressed in many cases.

“Recently, in a discussion with an industry executive responsible for HR, we were shaking our heads when he was wondering why anyone works for the meagre wages and salaries they pay them – go figure. On the other hand, career decisions are not only related to pay. Appreciation and motivation go a long way. The industry overall is performing poorly on this subject, especially in this region. The successful exceptions are faring well with having the same team for over a decade in many instances even during the times of unprecedented levels of stealing staff from competitors. It is all about ownership demonstrating leadership and providing direction and support not only in strategy, but in stability, predictability and mutual reliance on one another in the triangle of guests, employees and management.”

Connecting leaders, sharing knowledge

This year’s HOTCO, the fifth edition of the event, brings together a number of industry icons, including keynote speakers Mary Gostelow, president and editor of Gostelow Media Global, and Ruslan Husry, the managing director of the HR Group.

Other leading names in the industry who will be present at the event include Paulina Mazurkiewicz-Kurek, the chief financial director of Polski Holding Hotelowy, Ufi Ibrahim, CEO for Energy and Environment of Alliance, Valeri Chekheria, a partner and strategic projects director at Slow Group, Theodor Kubak, managing partner of Arbireo Capital and Value One Hospitality, Pankaj Birla, the area vice president of Eastern Europe at Marriott International and Noah Steinberg, chairman and CEO of WING.

“Our goal is to connect these leaders – who all have proven their ability to succeed irrespective of obstacles and external factors – and create a network where the region’s industry can benefit from their knowledge,” says Gomola.

“In this fast-changing business environment HOTCO will continue to shed light on the global views and direction of the hotel industry. We will always focus on highlighting the buzzwords that generate investor attraction and help contribute to hotel and resort industry growth.”

HOTCO 2022 takes place at the Kempinski Hotel Corvinus Budapest from May 30-31.

This content has been produced in collaboration with an Emerging Europe partner organisation.