Academic journal article UTMS Journal of Economics

Investment Efficiency in New Hotel Buildings in Croatia

Academic journal article UTMS Journal of Economics

Investment Efficiency in New Hotel Buildings in Croatia

Article excerpt

Abstract:

Abandonment of mass tourism in the late 80-ies of 20th century and attitude of humane tourism oriented to the needs and requirements of individuals, it is characterized by changes in the design and architectural design of hotel facilities. Features and functionality of hotel facilities are affected by trends in tourism demand. Tourism gets new features, which hotel companies must adapt. Individualism, humanism and hedonism are the guidelines that accompany the tourist industry in the 21st century. They determine the new considerations shaping and arranging hotel facilities, and the need for transformation of the hotel buildings designed for mass tourism in facilities for contemporary tourist who is aware of his needs, desires and aspirations. These trends should be monitored and the hotel industry in Croatia. The last decade marked by investments in reconstruction and modernization of existing hotel facilities, but investment in new hotel facilities are still minor. The reason for this is the fact that the hotel industry is low profitable activity, but also in the unfinished privatization, lack of domestic financial capital and the lack of attractiveness of the Croatia to attract foreign capital which would allow meaningful construction of new and rehabilitation of existing hotel facilities in line with trends in the tourism market. This paper critically examines the state of the hotel industry in the Republic of Croatia and its competitiveness in Europe, and it presents the results of research on the effectiveness of building a fictional hotel in Croatia, with a comparative analysis with European hotels.

Key words: Hospitality, Investment, investment efficiency.

Jel Classification: L83, G31

INTRODUCTION

Unplanned construction of hotel buildings in Croatia, resulting in aggressive action in space, which leads to a reduction in Croatian attractiveness as a tourist destination. The application of standards in the construction of hotel buildings, tracking trends in architectural design and construction of hotel buildings with orientation to the demands and needs of tourism demand are key determinants of the development of Croatian hotel industry. The hotel's facilities must be integrated into the environment and reflect the image destination in which they are situated. Profit should not be ahead of the interests of the community. Appropriate design and functionality of hotel facilities would contribute to improving image as a tourist destination with a highly developed awareness of tourism "on a human scale". In such circumstances, it is realistic reflection of channeling financial resources into the design and construction of new and redevelopment of existing hotel facilities that will ensure the profitability of the hotel business. It is therefore the need of research efficiency investments in new hotel facilities, taking into account factors that affect the attractiveness of the hotel facility (and the destination as a whole) and the utilization of accommodations: design and construction of hotel facilities in line with the trends, as many facilities in the hotel and resort that will satisfy discerning tastes of tourism demand, etc.

STATE OF CROATIAN HOSPITALITY

The last decade of the Croatian tourism was marked by the abandonment of the concept of mass tourism and the development of selective forms of tourism and the intensification of the investment cycle in the hotel industry. Tourist arrivals and overnight show a rising trend, and despite the improved market position of the Croatian international tourism market, the Croatian hospitality is burdened by a number of problems.

In 2011 Croatia disposed with accommodation capacity of 128,003 in 616 hotels and aparthotels, as compared to 1990 (142 917), a decrease of 10.4 %. A key feature of the structure of accommodation in Croatia is still on low level of participation of hotel accommodation in the total number of accommodations (only about 13. …

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