Tourism in crisis – hundreds of hotels up for sale

Tourism in crisis – hundreds of hotels up for sale

Hundreds of hotels, apartment buildings and guesthouses are up for sale in Montenegro. Many of these are located on the coast and range in price from a few hundred thousand euros to millions. Tourism has long been a major source of income for the country, so the worsening crisis may have serious consequences. The state has been pursuing a flawed sectoral policy for decades, experts say.

ECONOMY WORLD MARCH 24. 2023 10:07

Plenty of choice

There are currently around 500 hotels for sale in the Adriatic state, and most of them are on the seafront. Browsing the listings of real estate agencies, it becomes clear that what’s on offer is mostly small capacity hotels boasting 6-8-10-12 rooms, and these are available for as little as a few hundred thousand euros.

Here are some specific examples: a six-room hotel built in 2009 in Herceg Novi, situated only around 200 metres from the sea, costs 399,000 euros; a 12-room apartment house in Bar, 800 metres from the beach, 470,000 euros. However, there are also a fair number of luxury hotels: an 11-room hotel with a spa and panoramic swimming pool on the picturesque Bay of Kotor costs four million euros.

Image: Screenshot

Breathtaking nature, less and less tourists

Independent since 2006, Montenegro has around 300 kilometres of coastline, mostly bordered by high mountains and dotted with picturesque scenery. The beaches are 73 kilometres long. From the fjord-like Bay of Kotor, to Budva, famous for its vibrant nightlife, or Ulcinj, popular for its sandy beaches, there are many towns and villages to visit.

Yet, tourism is losing strength every year. In 2022, for example, the number of those deciding to spend their holidays in the most popular region of Budva was down 20 per cent.

Photo: Realitica.com

The share of Western tourists is traditionally low: in 2019, they accounted for around 35 per cent of all visitors. However, the number of visitors from the Eastern and the Western Balkans is also decreasing. Montenegro used to be popular with Serbs, who in the 1990s saw it as virtually their only option for a beach holiday.

In recent years, however, the habits of Serbs have changed considerably. Being able to travel more easily, the majority opt for Greece, but many vacation in Croatia, and flights to exotic destinations are also becoming increasingly popular.

Meanwhile, Montenegro proved unable to compete with Greek or Croatian tourism. Although Montenegro offers more favourable prices and unparalleled natural wonders, Western tourists are still a little skeptical about this unknown state that is less developed economically, and also difficult to reach.

Montenegro must change its tourism policy, according to expert

According to the dean of the Faculty of Tourism in Budva, it is also a problem that the majority of tourist accommodation capacities in Montenegro are not hotels, but private homes, the quality of which is often very low. Hotels make up only 10 per cent of the total capacity, Rade Ratkovic explained, adding that this leads to a loss of value in the sector. By way of comparison, he said Greece and Spain both offer a higher proportion of hotels.

Image: Realitica.com

„Montenegro follows a completely wrong policy in terms of tourism and urban planning,” the expert stressed, adding that in recent decades the construction of apartments and flats designed specifically for tourism has taken the sector in the wrong direction.

Mr Ratkovic says it is time to define the target audience, and for accommodation providers to organise themselves into a network.

„Individual entrepreneurs cannot go to the market, and almost no one encourages the networking of our country’s tourism capacities,” Mr Ratkovic told investitor.me.

As there are many ads but few interested parties, the advertised hotels could remain without new owners for a long time, according to the dean at Budva’s tourism faculty.

„Our economy is in crisis, we don’t have a clear strategy, and until this becomes a priority, there will be no progress. We are not handling the situation int he right way. Some of our hotels offering excellent quality is all for naught, if we fail to open out gates to the stronger, western markets,”

the expert said.

ECONOMY WORLD

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hotel, montenegro, sea, summer, turism