Thessaloniki Hotels Half Full, But More Needed

On the average, hotels in Greece’s northern capital, Thessaloniki, during the first eight months of this year posted a occupancy rate of 52%. Hoteliers say they are hardly satisfied with the result, but they say at least they have managed to increase the number of foreign overnights from last year’s 28% to 36% this year.

Thessaloniki has managed over the past few years to modernize and develop its hotel sector. Yet it continues to have a deficit in five-star hotel capacity, six years after the government gave the green light to construction of new units with a total capacity of 1,000 beds within city limits. Even after the amendment of the original decision, which included four-star (category A) hotels in the proposal, only 20 percent of the approved additional capacity is available.

According to newspaper reports, the problem is not a lack in investor interest, which remains as strong as ever, but in the lack of suitable land within the city. Some otherwise suitable areas cannot be used, as they have been earmarked for other uses or are burdened with a series of administrative restrictions prohibiting their utilization.

There are, however, some success stories. Thermi, a company that represents the interests of the InterContinental chain, has apparently succeeded in overcoming obstacles and agreed to purchase of a 8,750 sq.m. of space on the old waterfront for 2.5 billion drachmas. It plans to build a luxury hotel unit there, which will be ready by 2003.

Other hoteliers, to increase the number of rooms in the city, have leased old buildings for restoration.

According to the tourism department of the central and western Macedonia regional authority, Thessaloniki today has 45 hotels with more than 3,400 rooms and 6,200 beds. Of these three are five-star, 14 are three-star, 11 are two-star and 12 are one-star units.