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Continental hotel group budgeted EUR 30 mil. investments for this year aimed to completing the only 5 star unit within the group, Grand Hotel Continental in the Romanian capital and of an Ibis Hotel in Sibiu. The two units will open in June, employing approximately 160 persons.
70% of the total amount of the investment will be financed by external sources, while 30% will come from own resources. Radu Enache, president and main shareholder of Continental group, stated that the group plans to attract financial support from banks or sale & lease back contracts. At present, the group debt ratio reaches 28% of the assets value, stated Enache.
Moreover, construction works to Continental Forum hotel in Timisoara will start this year, declared Radu Enache.
In 2008, Continental group registered EUR 27 mil. turnover.
This year, Continental chain will reach 16 units, while Radu Enache aims to own over 35 units.
In 2007, the group attracted to its equity the Czech investment fund PPF and announced investments of EUR 135 mil. The group has already invested EUR 60 mil. of this budget. Radu Enache considers that the foreseen budget will be overrun and the completion period will extend with 2 years until 2012-2013, as a result of the economic crisis.
Radu Enache stated the price in construction sector is low, thus, investments are an opportunity to be exploited at present.
Enache plans to open new hotels in cities such as Arad, Cluj, Bucharest and Iasi.
10 of the 35 units projected during the investment period will operate under the 2 star Hello brand.
Enache expects for 2009 a 8% increase of the businesses, up to EUR 23-24 mil. This year budget includes Hello and Continental Forum hotels in Sibiu. Grand Hotel Continental and Ibis Sibiu are not included, as they will open in June this year.
Enache considers tariffs’ reduction in order to achieve the estimated revenues for this year.
Sursa: Ziarul Financiar [11.02.2009]
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Fivestar Hospitality Consulting 
