Greece is attracting large-scale hotel investments as tourism continues to recover with demand targeting better quality hospitality services.
Despite easing travel restrictions, experts point out, however, that the tourism market is not seen returning to 2019 levels until 2023, and not 2022, as Greek government officials claim.
New investments are being launched for resorts in Mykonos, Crete, Corfu and Zakynthos, according to data from Arbitrage RE, after the announcement a few days ago that Sani / Ikos is entering Crete with a 125-million-euro project.
In comments to Businessdaily.gr, Vassilis Fotopoulos, Associate Director, Hospitality Lead at Arbitrage RE, explains that "Greece is now becoming a pole of attraction for large tourism investments that will draw luxury tourism."
"Demand for hotel properties by foreign and domestic institutional investors did not stop during the pandemic, while new reliable and international investors expressed their interest in placing themselves in the Greek market," said Fotopoulos.
"Demand was focused on two main categories, city hotels in need of renovation and large-scale resorts on popular island destinations, with the possibility of upgrading and having their management taken on by international brands," he added.
Among the resorts that will open their doors in 2022 is the five-star hotel Once in Mykonos, located in Ornos (managed by Louis Hotels), and the One & Only Aesthesis in Asteria Glyfada, which will have 127 rooms, suites and villas - a collaboration between Kerzner International brand with Grivalia Hospitality S.A.
In addition to the resilience in tourism, foreign hotel brands are looking for opportunities to upgrade hotels in Greece, especially in Athens.
A number of new hotel units are opening in the center of Athens in investments that are estimated to exceed 100 million euros for 2022 alone.
These are projects that involve either the purchase and renovation, or the leasing and reconstruction of old buildings, in order to function as hotels. Investors and real estate development companies such as Prodea Investments, Dimand Real Estate, as well as hotel chains such as the Fattal group and Brown Hotels, are among the investors.
Recovery in 2023
At the same time, the Greek tourism market seems to be recovering, but the latest forecasts anticipate a complete recovery in 2023, and not in 2022, as recently stated by the Minister of Tourism, Vassilis Kikilias, in an interview given to Sky News television.
Citing data from Tourism Economics, consultants GBR estimate that there will be a strong rebound in 2022, but that "the full recovery is expected in 2023, while long-distance travel in Greece is expected to recover in 2024".
Evidence also shows that tourism in Greece is rising faster than in Spain, but not at the same rate as in neighboring Turkey.
About 8.6 million international tourists traveled to Greece in the period January - August, down 61% compared to the same period in 2019.
In the same period, Spain recorded 15 million international arrivals, leading to a drop of 74% from 2019, while the corresponding decrease in Turkey reached 55%, according to GBR.