ITB Reflects Industry Optimism

BERLIN—A record-breaking 10,923 exhibitors from 184 countries gathered at the ITB convention and marketplace in Berlin March 7-11, where travel professionals met to network and discuss industry trends. ITB's optimistic atmosphere was attributed to a financially sound 2006 for the travel trade. "We're coming off the back of a record year for all segments of the travel business," said WorldHotels' CEO Michael Ball, whose company is looking to expand in the U.S. and China. ITB broke attendance records this year; trade entrance hall is shown

Hotel Expansions: Signs of a Strong Travel Industry

Of the roughly 1,722,000 square feet of space showcasing such international exhibitors as tourist offices, technology providers and tour operators, the most bustling by far was the hotel segment, whose representatives gathered for appointments in opulent booths modeled after hotel lobbies and bars.

At ITB, Hilton Hotels Corporation revealed aggressive growth plans for Europe. The hotel company said it anticipates adding 1,000 hotels within North America in the next five years, and 1,000 hotels internationally over the next 10 years. Hilton this year will open 16 Hilton hotels in Europe and another nine (including a Hilton Garden Inn in Frankfurt) by 2009, along the way entering four new markets: Russia, Ukraine, Poland and Portugal. ITB this year broke records with nearly 11,000 exhibitors; India is shown

Hilton said the U.K. is being eyed for mid-market development and conversion opportunities, while Spain is being considered for new builds and conversions. Italy is a target for franchise opportunities, while Germany has potential growth for new hotels in the mid-market sector. Russia is being seen as a country with opportunities to develop full-service hotels.

To oversee this growth, the company opened four development offices in Europe in late 2006 in Moscow, Vienna, Madrid and Frankfurt. The news comes on the heels of Hilton's announcement that it is selling its Scandic hotel chain for $1.1 billion to EQT, a private equity group with operations in northern Europe and greater China. Scandic is the largest hotel operator in the Nordic region and operates full-service hotels in the mid-market segment. Plans are for Hilton to maintain a Nordic presence with six Hilton hotels: three in Finland (including the HiltonHelsinkiVantaaAirport due to open in August 2007), two in Sweden and one in Denmark at the Copenhagen airport.

WorldHotels' Ball said the company is looking to expand its presence in the United States. "We are under-bedded in North America," he said, noting that Chinese cities beyond Beijing and Shanghai are also on the company's to-do list. "There is so much domestic demand, so we need to fill in a few gaps."

China is also on the radar for Marriott International, which already has 34 properties across China and plans to open 12 more by 2009. At ITB, the hotelier reported $12.2 billion in sales in 2006, attributing 24 percent to reservations made through its web site. However, the company didn't neglect to mention its travel agent channel, which Marriott said has been a steady performer for more than 10 years.

Meanwhile, Starwood Hotels & Resorts announced plans for a 76-room W Hotel in Milan—the first W in Italy—which further represents the hotel operator's aggressive growth outside the U.S. The property will be a conversion, scheduled for December 2008. The W Milan is one of seven recently announced W hotels scheduled to open in Europe, Africa and the Middle East in destinations such as Istanbul, Barcelona and St. Petersburg.

Starwood also announced its first timeshare products in Mexico. Construction will start this year on the St. Regis Residence Club in Punta Mita, as well as the Westin Los Cabos Ocean Villas, which will be built next to the hotelier's existing Westin property, allowing villa owners access to the hotel's amenities. Already under construction is the Westin Lagunamar Ocean Resort in Cancun, expected to debut in 2008.

Also reflecting a financially sound travel industry, many tourism offices reported an increased number of visitors in 2007. Many say numbers are once again reaching pre-September 11 benchmark figures, and perhaps New York showcased the best evidence. "In 2000, we had 36 million visitors," said George Fertitta, CEO of NYC & Company. "In 2001, we had 35.2 million visitors and in 2002, we had 35.3 million. In 2006, we had a record-breaking 44 million visitors." NYC & Company's goal is to attract 50 million visitors to New York City by 2015. The organization is reaching out even more now to the international market, opening offices recently in Spain, Russia, Scandinavia and Amsterdam, more than doubling its international presence in the past year.

Among the show's hot topics was youth travel, dubbed the industry's fastest-growing sector, given that a fifth of all international visitors around the world fall into the 16-24 age bracket. According to a study by the World Youth & Student Educational Travel Confederation (WYSE) younger travelers stay longer, spend more and participate in a broader range of activities than average tourists. WYSE noted that fewer than one third of tourism agencies worldwide have a marketing policy for this sector.

The future of travel was on everyone's minds: Seminars discussed the effect of global warming on travel and the last day of the conference was devoted to space travel.


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