advertisement
.
.
|
|
advertisement
.
.
| by Barry Napier, January 2007
In previous articles we looked at the Master Plan used by Istria to develop its tourist base, and the opportunities this afforded to serious investors. Though a small part of Croatia, Istria is still the most advanced in its tourist provision. The Master Plan�s duration is 2004 to 2012.
Investors know that when a country wants to become a member of the European
Union, it usually hauls itself up the internal investment ladder by improving
its infrastructure. Istria started this work in 2004, with a budget of
billions of Euros. When the country finally becomes a full member, the
return on investments, especially in property, will increase dramatically.
That is the usual pattern in all of Europe.
Initial Implementation Denis says there were a few hindrances to the implementation of his Plan, but that there has been a �Very successful actuation of the repositioning and restructuring process.� If you read the earlier articles, you will know that Denis began a massive region-wide program of improvement, necessary if Istria is to attract investment. One issue yet to be resolved is that large areas of land are still under the control of the Ministry of Defence. Denis sees their release as important if Istria is to move forward as fast as desired. However, using good strategic sense, he is currently developing and working around these areas, so that any release of Defence land will simply be inserted into an already-developed infrastructure. Croatia as a whole does not appear to embrace the need to develop a tourist infrastructure, with tourism a lower priority than it is in Istria, and so incentives in the rest of Croatia are weak at the moment. Istria itself is running full-speed ahead! Spending in Istria over the first three years has increased, making Istria a top European destination for Europeans. It is gaining interest from the rest of the world, too. The quality of hotels is being raised. There are only 13 four-star and 2 five-star hotels in the whole of Istria, so the available opportunities are enormous. I need not spell out what this could mean for foreign hoteliers. Prices of accommodation and revenue indexes are growing, the tourist season is extending, and the types of tourism products are increasing. The Plan links growth with a retention of national culture. Any investor willing to embrace this ethos is welcome. One private investor, who built a luxury villa inland, has seen his R.o.I. rise sharply in just 12 months. The R.o.I. on an hotel will be very much more. The bulk of inward investment over the past three years (43.4%) belongs to larger hotel investors. In 2004 investments from this source rose by over 50%, and much more is hoped for. The rise amongst local municipalities, small businesses, catering and handicrafts has roughly doubled. Private accommodations, such as villas, have remained the same. A number of explanations are possible for this � the long time span between deciding to build and actually getting a property built. Villa and apartment owners who think Istria�s building �speed� is very slow should remember that the area is still in flux, and local municipalities continue in their old ways. It is part of their culture. So long as this is taken into account, progress is inevitable but slow. Any attempt to quicken it may be seen as an insult� like one investment company that forgot the local rules and attempted to speed things up with a bribe! Large-scale investors, though, will find their pathway very much enhanced, because the tourist board will be directly involved. Agritourism and rural tourism is slow to respond, but has tremendous potential. Another investment possibility. Tourism Investments Over 50% of investments in attractions has been realised. Investment in services and competitiveness has already been exceeded, with another six years to go. Investment in accommodations are almost there, whilst investment in infrastructure has been well-exceeded. In other words, Istria is quietly booming! 44 out of 138 �investments in survival� have already been achieved. These include basics such as sewage, parking, roads, water, wine upgrading, and so on� all the smaller things that add up to the bigger picture. �Investments to succeed� include art and festival houses, Riva conversion, sign-posting and interpretation, refurbishment of old castles, restructuring of hotels, themed beaches, and so on. 68 out of 215 such projects have been realised. Of new investment opportunities � sophisticated golf resorts, �wellness� ideas, theme parks, etc., 11 out of 115 projects have been realised. Thus, there is plenty of room for foreign investments. Important Projects Denis gave a list of the most important projects presently being undertaken, or already completed: Hotels and campsites in Umag and Porec, the latter including apartments. Hotels, apartments and campsite are in progress in Rovinj, with three tourist villages planned. Other sites are in Pula and Savudrija. Wellness hotels are in progress in Umag, with amusement parks in existing camp-sites and hotels. Same goes for Rovinj and Porec. High-class accommodation is projected for Novigrad (Hotel Nautica) and Plovanija (Hotel Mulino). Both are five star. New four-star hotels are now in Brtonigla and Rabac (an apart-hotel). There are ten high quality Stancias and 20 luxury villas in rural Istria. Attractions include three wellness centres, a fitness centre, and two casinos. Already well advanced are marinas in Novigrad, Funtana and Vrsa. Denis wants to see more marinas around the long coast of Istria. Three wine cellars and olive producers, two wine cellars and one olive factory, are being developed or renovated, plus 10 top-level restaurants. Galleries, museums and multi-media attractions will be in Novigrad, Rovinj, and Porec, with opportunities for many more. |
Old Rovinj |
Harbour, Porec |
| Marketing
Marketing is a vital component in any country�s tourism drive. Denis assures that �marketing strategies are well in hand, to make sure that any foreign investments are backed by optimum earnings potential.� A new visual identity is already underway, the marketing plan is being implemented, advertising in conjunction with hotels and local tourist offices is gaining ground, and upgrading (known as �Domus Bonus�) of private accommodations are all helping to boost Istria�s image and potential. It is my personal view that Istria�s image is already superb, from its misty mountains and forests, to its incredibly pretty seaside towns. The �Wow!� factor is there anyway, so I look forward to seeing the end result, after full implementation of the Plan. My only concern is that Denis, in such a big development plan, is able to stick to his promise to retain the Istrian culture and ethos. He can only do this if he guards against over-development, which would spoil such a lovely area. So far, though, he has held true to his promise. Competitiveness To help make Istria a top destination, a variety of extras are introduced. These include bike and trekking tourism, gourmet tourism (though many hidden rural restaurants are already superb), wine tourism (the wine growers are friendly and laid back), olive oil tourism (for those expert cooks), and truffle events. Istria hosts an annual international truffle competition, with top chefs. Cluster Achievements To bring about success, Istria divided its efforts amongst 7 �clusters� or municipal groups. Each cluster has to finish a number of tasks. In the first three years, the private sector has completed 24% of these, local municipalities, 9%, but the Tourist Board of Istria a massive 60%, thus proving its desire to come out on top in world tourism. All clusters are working through their allotted tasks, so, many projects are still being realised (detailed figures are available from Denis for each cluster or area). Even the Hinterland cluster (inland rural areas) are well on their way to completion. The Next Three Years Basing his projections on the first three years, Denis believes the next three years will consolidate and improve on what has already been achieved. By 2009 he expects investment in large hotels to increase by well over 100%, and new tourist projects to increase by a similar percentage. There ought to be a reasonable rise in both local municipality and small business investment. However, there is bound to be a big opportunity for tourism-support businesses as momentum builds. I expect to see many of these ventures arising. Investment in catering and handicrafts are expected to rise by one third, with a smaller rise in private sector accommodation (villas and apartments, etc), agritourism and rural tourism. Compared to the Master Plan�s figures, attractions should take 33.4% of the total investments by 2009, services and competitiveness 75.5%, accommodations a huge 136.3% and infrastructure 220.6% - the latter again proving the seriousness of Istria to be a major contender in the tourism market. Most Important Projects The most important projects over the next three years (not including any suitable offers coming from newcomers), worth a total of over one billion Euros, include:
The figures suggest that marinas and golf projects (especially when linked to a specially-built resort) will bring in the greatest income for investors. Conclusion Denis says that Istria is successfully implementing the Ten Year Plan�s tourism development; its competitive edge is increasing; and Istria is bringing its new image and identity to the world in a new and sustainable way. As he says, �The first phase of restructuring and repositioning of the destination has been successfully implemented.� The figures I have abstracted from the full report appear to be promising. Denis is dynamic, with a cool head. If he can keep the reins tight, there is no reason why Istria will not surpass the hopes embedded in the Ten Year Plan, to the benefit of all involved. Istria is a beautiful country, with natural assets to die for. Its historic sites are wonderful. And this is all without much effort. Yet, Istria cannot be denied a slice of the economic and financial cake. After all, it is making a drastic and monumental attempt to become a top player in a relatively short period of time. However, it is sincerely hoped that when foreign investors meet local needs, it will not end up as a rural copy of a rich-dude ranch. It must remain natural. To be desired, Istria needs inward investment plus a retention of its character and culture. When asked about this, Denis said, �I only hope I have the ability to steer things the right way, so that all our dreams can be fulfilled, without losing the essence of Istria.� I like his humility � something hardly ever seen in someone at high-level. Denis has drive, but he also recognises that his own strengths must be matched by an equal drive on the part of investors to succeed in a way that sensitively preserves Istrian culture. So, if you want to invest � try Istria. The figures look good and the opportunities are still beckoning! |
.
| Contact:
Barry Napier
|
The
man responsible for the implementation of the Plan is Denis Ivo�evic, Head
of Tourism, and his vision for Istria remains enthusiastic and promising.
He is offering opportunities for hotel, villa and tourist developers and
providers that are hard to come by.