Thai-owned hotel chain sizing up Irish entry

International hotel chain, Vienna House, is considering a move into the Irish market. It is taking on alternative accommodation providers, such as Airbnb, writes Geoff Percival.

The Austrian company — owned by Thai real estate developer, U City — is broadening its appeal to the modern traveller, via a new brand that offers more than just a hotel room. A range of accommodation choices — hotel room, family rooms, studio apartments, even office space to rent — will be offered under one roof.

The new ‘Vienna House R.evo’ brand is described as a ‘tribrid’ model, incorporating elements of hotel, hostel, and serviced-apartment accommodation. The first of the new properties will open in Munich, later this year, and the group has short-term plans to open in Glasgow, Bangkok, Budapest, and Hamburg.

The initial focus is on centrally located sites, in mid-to-large sized cities, and the company is also looking at Dublin, as a potential location. It is likely to expand through a franchise, rather than a centrally-owned model.

Vienna House, which was acquired in early 2017 by U City, for nearly $350m, already operates 34 hotels, but these are all under its more mainstream product offerings and are located in central and eastern Europe in Slovakia, Russia, Romania, Poland, Austria, Germany, France, and the Czech Republic.

“Vienna House R.evo is the way people are today — mobile, uncomplicated, curious, and open-minded. Technology has changed us, and it is time that we give these new ways of life the space they deserve,” said Vienna House chief executive, Rupert Simoner.

“Construction is scheduled to begin this year. Demand is high, and we are already looking at other openings.

“The aim is to conclude up to three projects a year with the Vienna House R.evo brand,” he added.

Tourism accounts for 4% of the Irish economy, when measured in GNP terms, and the sector is the State’s largest indigenous employer. However, while hotel visitor numbers remain on the up — despite a drop in UK visitors, due to Brexit uncertainty and a weakened sterling — the Irish Hotels Federation has warned against complacency and called for more targeted investment to help develop “new and engaging products”.

Recent figures proved demand for alternative accommodation sources is strengthening; by showing that Airbnb generated around €500m — through users’ spending habits — for local economies around Ireland in 2017. The company said it is spreading tourism benefits beyond traditional hotel areas.

Nearly 90% of Airbnb guests seek out the company’s accommodation listings for holiday or leisure stays, rather than for work.

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