19.07.2010 Hotel Headache

Eurobuild magazine, July 2010

Eurobuild magazine interviewed Polina Stoykova, Chief Operations manager for Bulgarian Properties, for their July 2010 issue.

According to consultants, the number of new hotels offered for sale this year will not be higher than last year. "However, this does not mean that there has been a positive turn-around in the trend, because the new hotels are just being added to those from last year that have yet to find buyers. It should be borne in mind that many owners are not officially putting their hotels up for sale, fearing that this would have a negative effect on the hotel's image. Nobody benefits from rumours that a property is for sale. This is why it is hard to give an accurate picture of the situation," explains Polina Stoykova, chief operations manager of the Bulgarian Properties real estate agency. The company has over 50 hotels across the country in its offer.

"The situation has now changed completely. In 2007 and 2008, hotels were being built and almost nobody thought about selling them. One difficult season for the coastal and mountain resorts was enough for the owners to start off-loading them or leasing them to other operators, treating this as a temporary step. At the moment it can safely be said that every hotel owner would consider selling if they received an offer," adds Polina Stoykova. Small hotels with prices of up to EUR 500,000 are the most popular, if one can even talk about there being any interest at all. The potential buyers include both individual investors and opportunity funds on the lookout for a bargain. However, they still have reservations over the prices. "It can certainly be said that there is still a long way to go before a deal between the seller and the buyer is reached. In some cases the expectations differ by 20 percent or more," Polina Stoykova emphasises.

Petar Radev, the managing director of PropertyManagement BG, is advising hotel owners to be in no hurry over deciding to sell, especially when there is such a big supply. The company, which is engaged in holiday facility management across the whole of Bulgaria, cannot complain about there having been a shortage of clients since last year. According to Petar Radev, the problems faced by the industry not only result from the sometimes dubious quality of the service or the lack of experience of the owners, but also from the absence of any vision for the development of the hotels. "The supply of accommodation is clearly too high and the number of people visiting the country is more or less the same," claims Mr Radev.

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