International Hotel Brands Expand in Russia
Global hotel group Starwood Hotels and Resorts Worldwide plans to more than double its presence in Russia and the Commonwealth of Independent States (CIS), with seven new hotel openings by 2015.
InterContinental Hotel Group (IHG), Four Seasons Hotels and Resorts and Morgans Hotel Group (MHG) are also expanding in Russia. The Four Seasons St. Petersburg is expected to open later this year, while both MHG and IHG will open properties in Moscow in 2015, including IHG’s largest-ever Holiday Inn.
“As one of the world’s fastest-growing outbound travel markets, Russia represents a great opportunity for us,” said Starwood President and chief executive Frits van Paasschen. "With a rising middle class, growing disposable income, an affinity for luxury brands and huge pent-up demand for foreign travel, Russia is emblematic of the growth we are seeing in regions around the world and key to our global growth plans.”
With a developing online travel market and demographic of wealthy consumers, Russia is a lucrative destination for international investment. Speakers at this year’s ITB Berlin travel conference said that Russia’s travel market is growing faster than China’s. Hotel chains opening in Russia are hoping to appeal to domestic travellers while also creating brand loyalty for outbound Russian travellers.
Inbound visitors are having less of an impact as tourism accounts for just 1% of the Russian economy, according to speakers at the 2011 World Travel Market business event. However, the forthcoming 2014 Winter Olympics in Sochi (see New Destinations) and the 2018 FIFA World Cup football tournament are expected to dramatically increase inbound travel.