Athinagoras Konstantinidis, Director at Atrium Hotels is a new speaker at MR&H 2019. Athinagoras will join the Regional Outlook: Island Markets session exploring investment in islands where infrastructure, incentive schemes and land availability offer interesting opportunities. In addition to being a director with the luxury resort group Atrium Hotels, Athinagoras is also Vice President of the Rhodes Hotel Association.
1. Atrium Hotels is a family business with a strong focus on great customer service through talent management. How do you maintain this focus with all the other operational and market demands on the business?
Our intense focus in superb customer service has indeed played a big role in our company’s success. All our hotels are in the Top-25 Hotels in Greece (Tripadvisor 2019 Rankings), have received Gold Awards from HolidayCheck, Booking.com, all the major Tour Operators and many other noteworthy hotel rating agencies. In addition, our group has the privilege of being consistently ranked in the Top-10 Greek companies in terms of financial performance (ICAP rankings).
Being successful in such a competitive industry requires significant product differentiation, as luxury hotel resorts operate in a monopolistic competition market structure. Aside from striving for hotel operational excellence and optimum market strategy, Atrium Hotels have a unique customer centric approach, originating from our obsession with employee satisfaction. The cliché “happy employees make happy customers” couldn’t be more relevant in our case as it’s at the heart of our organization, and as a family business, we truly consider the hotel staff an extension of our family. The genuine attention and care from the company’s leadership to our staff is eventually received from our guests. You may visit the best hotel in the world, with outstanding facilities and flawless service, but if the staff are cold and robotic the hotel is soulless. Our ambition is through effective talent management and healthy employee relationships to make Atrium Hotels the epitome of traditional and genuine Greek hospitality combined with superb luxury.
2. You currently have 3 luxury resorts based in Rhodes, Greece. Do you have ambitions to expand and if so, which markets are you considering?
We are examining possible expansion opportunities in several Greek destinations like Athens, Crete and Kos. For example, last year we participated in an auction for the acquisition of 3 hotels in Kos. Currently, we are focusing on land purchases in various locations in Rhodes and Crete, have already acquired a critical mass and plan to start development in the next years.
3. In your experience, what do you believe are the main issues investors consider when assessing resort development?
The main question you should always ask when considering resort development is what are you adding to the market supply. Because in popular tourism destinations, where hotel concentration is high and attractive land availability is limited, one has to be confident they’re filling a gap in the market and differentiate notably from competing products. Resort development is a capital-intensive endeavour, and although land purchase is around 10% of the total investment, the location of the investment plays a disproportionately larger part in the value of the investment. The choice of location is therefore of critical importance, as it should fit in the overall vision and the concept of the project. Also, one has to carefully examine the factors affecting the legal certainty of their investment. Because Greece is yet to legislate a Tourism Spatial Planning and Land Use framework, coastline use regulation, a thorough countrywide Forest Land, Archaeological Land mapping and Cadaster are still pending (to mention a few), one has to carefully consult with their legal and technical advisors when assessing investment legal certainty. Due to these risks, combined with the substantial bureaucratic hurdles that have existed in Greece for years (e.g. environmental), experience and knowledge in these matters is vital in evaluating resort development. Due to the newly elected Greek government the business community is very optimistic regarding the resolution of these matters, and right now the future for investments in Greece is brighter than ever.
4. What are the specific opportunities in an island market?
The Greek islands in particular have a great brand internationally, especially due to destinations like Santorini, Mykonos and the Aegean Islands. This definitely adds a lot to the value of a project, as people visit the Greek islands to explore a distinctive bundle of experiences. In the Greek Islands, natural beauty is complemented with culture, history, tradition and Greek hospitality. Interestingly, numerous studies presented by INSETE have indicated that the aforementioned natural and cultural wealth of Greece is far from being fully utilized when considering land availability, coastline and other land use. Furthermore, the biggest Greek islands have the advantage of having developed fully fledged tourism ecosystems, with a widespread presence of hotels, restaurants, tour operators, cruises, tourism schools and an overarching tourism conscience in the local communities. These, along with the efforts of the Ministry of Tourism and SETE to enhance tourism competitiveness, and the sophisticated marketing approach by Marketing Greece, are all fostering a dynamic, cooperative and healthy investment climate, critical elements for a successful investment horizon.
5. And conversely, the challenges of an island market and how to overcome them?
Infrastructure, transportation, flight connections and general access are often major challenges of an island market. Although the established Greek destinations normally possess the above, there is still ample room for improvement, especially in the smaller islands. The implementation of a strategic 10-year tourism growth plan by the Greek government in collaboration with private sector tourism associations is about to address these matters, alongside with competitiveness, innovation and sustainability. Another challenge in an island market is seasonality, and the well-known issues accompanied with it. Small labour markets and scarcity in talent for senior positions, due to the intensity of demand for staff, often means that the cost of human capital is high due to the necessary expenditures in staff accommodation and off-shore recruitment. Additionally, development cost can be pricier (20-25% higher) compared with the mainland due to remoteness, the shortage of organized large construction companies, expensive materials and supplies, etc. Lastly, regarding land availability, in many cases attractive locations have small-sized land ownerships which require effort, persistence and experience to complete large areas that are ready for development.
6. What is the importance and relevance of attending events like MR&H?
I’m confident that MR&H is a fantastic platform for knowledge sharing and networking. The experience and know-how of the attendants makes the whole event intellectually stimulating and highly educative, fostering discourse and debate about real issues faced by the hotel & real estate community. It’s a true pleasure and honour to participate in such an initiative that celebrates business excellence and spreads knowledge.
Athinagoras will be speaking on “Regional Outlook: Island Markets - A look at investing in islands where infrastructure, incentive schemes and land availability offer interesting opportunities (Baleares, Cyprus, Malta, Crete, Rhodes, Hvar, Sicily)” which takes place on Wednesday October 30 from 2:20pm - 3:15pm.
The current Advance Delegate Rate is only available until the 13th Sept. To secure your place at MR&H at this rate, please click below.