TUROB Assessment Report on Investment Incentive Certificates in the Accommodation Sector for the January-June 2015 Period

The “Investment Incentive Certificates” issued by the Republic of Turkey Ministry of Economy for the January-June 2015 period have been compiled, from the perspective of the accommodation sector, by the Association of Touristic Hoteliers, Operators and Investors - TUROB. Accordingly;

a) June 2015
For the month of June 2015, a total of 24 hotels nationwide received an “Incentive Certificate,” comprising 20 new hotel projects with an “Incentive Certificate” and 4 hotels with a “Modernization / Expansion” certificate.
The investments, which will be completed with a total expenditure of TRY 414.01 million, will create 1,259 new jobs. The new hotel investments will increase the bed capacity by 4,492 beds. Among the investments to be made across a total of 14 cities, Istanbul ranked first in the number of hotels with 4 hotels, followed by Antalya, Aydin, Mugla and Sakarya with two hotels each. In terms of the number of new beds to be added, Aydin ranked first with 1,280 beds, while Istanbul ranked second with 675 beds.
An increase and spread of investments across Anatolian provinces is notable. The provinces of Afyonkarahisar, Cankiri, Nigde, Sakarya and Sinop received a hotel investment incentive certificate for the first time this year.
Province / Facility / Beds
Afyonkarahisar 1290
Antalya 2490
Aydin 21,280
Balikesir 1230
Bursa 1300
Cankiri 124
Erzincan 133
Istanbul 4675
Izmir 1406
Nigde 158
Sakarya 2426
Sinop 1160
Trabzon 164
Van 156
Grand Total 204,492

b) Comparison of June 2014-2015
2014 / 2015 / 2015/2014 Difference
Number of Hotels to Be Invested In 2120-1 hotel
Number of beds to enter service 2,6884,492+ 1,804
Average number of beds per hotel 128224.6+ 96.6 beds
Number of new jobs 7291,259+ 530 people
Total investment cost (TRY) 153.52 million414.01 million+ 260.49 million
Average cost per bed (TRY) 57,113 thousand92,166 thousand+ 35,053 thousand

c) January-June 2015 period
In the 6-month period covering January-June 2015, the number of hotels to be newly invested in across 43 separate cities in our country rose to 134, and the number of beds rose to 29,966. The total investment amount rose to TRY 1,925.3 million, and the number of people to be newly employed following the completion of the investments will rise to 7,041.

While Istanbul was the city receiving the most incentive certificates in terms of the number of facilities with 30 hotel projects, Antalya ranked first in terms of bed capacity with a capacity of 8,765 beds.

CITY / NUMBER OF HOTELS / NUMBER OF BEDS
1Adana1148
2Adiyaman2152
3Afyonkarahisar1290
4Agri1130
5Amasya126
6Ankara5756
7Antalya138,765
8Aydin114,840
9Balikesir3448
10Bitlis1198
11Bursa2360
12Canakkale262
13Cankiri124
14Diyarbakir1164
15Duzce2276
16Erzincan297
17Erzurum11,000
18Eskisehir1120
19Giresun2162
20Hatay296
21Isparta1122
22Istanbul304,711
23Izmir81,173
24K.Maras2306
25Kars3188
26Konya3862
27Malatya1116
28Manisa182
29Mardin3222
30Mugla5905
31Nevsehir4531
32Nigde158
33Rize122
34Sakarya2426
35Samsun1300
36Sinop1160
37Sivas1106
38Sanliurfa126
39Tokat1298
40Trabzon3558
41Tunceli150
42Van4494
43Zonguldak1136
GRAND TOTAL13429,966

d) Comparison of the January-June period of 2014-2015
2014 / 2015 / 2015/2014 Difference
Number of provinces to be invested in 4543- 2 provinces
Number of Hotels to Be Invested In 170134- 36
Number of beds to enter service 47,65029,966-17,684
Average number of beds per hotel 280.2223.6- 56.6 beds
Number of new jobs 10,9127,041- 3,871 people
Total investment cost (TRY) 2,751.9 million1,925.3 million-826.6 thousand
Average cost per bed (TRY) 57.75 thousand64.2 thousand+ 6.45 thousand

Overview of the Hotels receiving an Investment Incentive Certificate in the January-June 2015 period by class and number of beds
HOTEL CLASS / NUMBER OF HOTELS / NUMBER OF BEDS
51813,103
44510,263
3615,966
200
100
Boutique/Special Facility 10634
TOTAL13429,966

Commenting on the report, Timur Bayindir, President of the Association of Touristic Hoteliers, Operators and Investors (TUROB), said: With the effect of the high-capacity investments planned in the Aegean Region, growth in investments in terms of bed capacity is being observed in June compared with the previous month. Another notable point in this month’s investments is our Anatolian cities, which received an incentive for the first time in 2015.

That said, when we examine the data for the first six months, we see that investments have slowed compared with the same period last year. However, this slowdown should not be interpreted negatively; on the contrary, it should be assessed as a positive approach.

We all know that the advancement of tourism and sectoral growth are made possible not merely through hotel investment, but through the development of a destination’s services as a whole. Beyond a destination’s existing touristic riches, accessibility, infrastructure and superstructure services, technology and social welfare have become preference factors for today’s travelers.

Therefore, we would like to interpret the data explained above as the investor preferring Anatolia as a new product, making more cautious and strategic moves, and taking trends and preferences into account.

TUROB ©
August 2015