Russia Needs to Overcome Regulatory, Bureaucratic Hurdles to Realize Hotel Development Potential

There is enormous potential to develop hotels in Russia, but that potential continues to be hampered by bureaucracy and a regulatory framework that is not conducive to growth. This was the key finding at the Russia round table discussion held at the second annual Hotel Investment Conference held in London last week.

The Panel was hosted by Michael O’Hare, Managing Director of Horwath HTL Russia and was joined by Patrick Fitzgibbon, Senior Vice President of Development for Hilton Worldwide (Europe and Africa) and Arlid Hovland, Senior Vice President for Business Development for the Rezidor Hotel Group.

The session covered several topics that are key to the current investment climate as the three experts gave their view on the current situation and what needs to be done to improve it. Russia was also compared to two other development hot spots, Russia and Turkey to compare and contrast business practices and ease of use in getting business done.

In addition to the challenges of dealing with a young and relatively bureaucratic country, Russia also struggles with a negative image of a place that is difficult to do business and subsequently harder to attract foreign investors. However, the group used the tremendous amount of development around the Sochi Olympic site as an example of what can be achieved in the right conditions.