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Brussels: ever more space for tourism

Is Brussels becoming the place to go?? One might think so. A multicultural crossroads of Europe, the Belgian capital shows a dynamism that is propitious to the development of short stays, which continued to grow despite the crisis. Its changing hotel supply is following the trend and shifting towards lifestyle. In 2009, although it suffered from a shortage of business customers that are nonetheless the majority in the institutional capital of the European Union, the city’s hotel industry is already moving forward again. A good sign for hotels that are in the works.

Increasingly central, each day Brussels further strengthens its position at the heart of Europe. And what was already true politically is also becoming a reality in terms of tourism. In fact, the capital of the Union constantly attracts a high – and constantly growing with each successive expansion – volume of businessmen to a city where in addition to the bodies of the EU there are also the headquarters of many corporations, 1,700 international associations, 6,000 lobbyists –more than in Washington – and 1,000 permanent journalists. And today this solid foundation has been joined by a growing leisure segment.According to the director of the TO, “it is still possible to grow the supply but it must happen parallel to the development forecasted by the tourism infrastructures.” A future Convention center with a capacity of 5,000 is expected in Heysel in 2015, in addition to a concert hall with seating for 15,000, and this will be added to the meeting center Le Square, that reopened over a year ago in the city center. With this new supply, Brussels, which now ranks second worldwide for accommodating conventions with over 300 according to the UIA, plans to attack the segment of very large events currently held in Paris, Vienna or Barcelona. The best is yet to come? Also in Heysel, Belgium is hoping to build a large stadium to seat 80,000 if the country wins its bid, in cooperation with Holland, to organize the FiFA World Cup 2018. Europe as well as the entire world would then have its eyes on Brussels for the culmination of a decade.Because today Brussels imposes itself as a rising value for the “short break”. A recent article in the Daily Telegraph presented the Belgian capital as more attractive for tourism than Paris. The fact that this daily paper, which is not known for having an exuberant Europhile attitude, is favorable towards a city that continues to suffer abroad from a boring, bureaucratic image perfectly illustrates the Belgian capital’s changing status. A Tower of Babylon with its inhabitants hailing from all corners of Europe, Brussels seduces. And its multicultural mixing creates an effervescence that contributes to softening a negative reputation for tourists.But this result is also the consequence of a growing awareness of local administrations about the importance of the sector, particularly with a goal to reabsorbing a high level of unemployment. “There was a real political will in the region to develop tourism, particularly by trying to make Europe more humane by organizing major events managed directly by the Tourist Office such as the Iris festival in the Spring, Plaisirs d’Hiver – the third largest Christmas market in Europe that attracts some 2 million visitors over a five week period – and, in the summer, Brussels les Bains and the Brussels Summer Festival,” explains Patrick Bontinck, general manager of the Brussels tourist office.The effort to stimulate travel to Brussels through an extensive museum offering is also bearing its fruit. The successful beginnings of the Magritte Museum with 700,000 visitors in 2009 attests to this. And this trend could continue with other thematic museums organized around existing collections in the city’s museums. “We have the works, we have the spaces. Now it needs to be organized,” remarks Patrick Bontinck about the goal.Repercussions from this active policy may be seen in the results for the hospitality sector. Last year, despite the crisis and the collapse of the British market, the leisure segment posted growth in nights by 7.3%. Local tourism – with the French in the lead along with Germans and the Dutch – has continued to bring in high volumes. And the growing influx of the low-cost Charleroi airport (+ 33% in 2009) explains the Italian market’s good resistance while favoring the growth of the Spanish market. At the same time, Belgian clientele, the number-one market with 17% of nights, supported the activity with growth by +14% in 2009. Rodolphe van Weyenbergh, secretary general of the Brussels Hotel Association (BHA) rejoices that “the Belgian capital is progressively achieving a good balance between Business and Leisure clientele. The summer and weekends are increasingly busy.”Thanks to that, Brussels limited damages last year with 5.2 million nights, meaning a drop by just -1.4%. According to Béatrice Walgraeve, the manager of the tourism observatory BXL, “this relatively good result in a difficult period proves that the market is stable. We are harvesting the fruits of our promotional work as in the last ten years nights grew by +22%.” This growth in short stays made it possible last year to offset the significant drop in the Corporate segment (-8.4%). However it did not fully succeed in compensating for it. Despite all the efforts made, Brussels’ hotel industry closed 2009 in the red. The combined drop in the OR (-4.9 pts) and the average daily rate (-9.2%) resulted in a drop by 15.4% in the RevPAR.“Brussels suffered, but stands a chance of taking off again sooner than other European capitals,” advises the secretary general of the BHA. In fact, by the end of the first semester 2010, room revenues were positive again with growth by +3.0%. This re-establishment began with a very good month of June with occupancy in July on a par with 2007 and 2008. “This was driven by the arrival of the Tour de France and the beginning of the Belgian presidency of the EU, whose effects should continue until the end of the year,” analyses Rodolphe van Weyenbergh; “occupancy is back on an uptrend and we hope that the average daily rate will do the same soon.” In fact, while the OR may be on an uptrend (+3.9% pts), the average daily rate continues to lag behind (-2.8%).Outside the current problems, this weakness with respect to rates is a constant for the hospitality industry because of the preponderance of Business clientele, which implicates a high number of negotiated rates. But it is an area where there is a real growth margin. In fact, the average daily rate in Brussels may progressively rise to the level of Europe’s great cities such as Vienna, Milan or Amsterdam. Paired with the expected growth of leisure tourism, this perspective explains the many ongoing developments. “There is a brand race. Before, hotel groups wanted a hotel in Brussels because it was the European capital. Today they want to be present because it is profitable,” remarks Patrick Bontinck. The proof: a dozen hotels for 2,000 new rooms are expected by the end of 2013. The world leaders are continuing to produce their full brand portfolios. From Sofitel to Formule 1, Accor has 17 hotels, including 6 Ibis and 2 Sofitel, with the openings of a new Mercure and an Adagio this year while waiting for a new Etap Hotel in the city’s southern suburbs. With the forthcoming opening of an Aloft, Starwood will soon have four brands after Sheraton, Le Méridien and Four Points. At the beginning of 2011, a Park Inn located near the Gare du Midi will complete inventory at Rezidor, one of the main players on an upscale segment with two Radisson hotels and where the headquarters is established in the city. IHG with three Crowne Plaza and four properties in the Holiday Inn family, Marriott with a Marriott, a Renaissance associated with Marriott Executive Apartments and a Courtyard, and finely Hilton with two Hiltons and a Conrad are also well-represented in the Belgian capital.Increasing numbers of groups want to find a place in Brussels and are coming from all directions: from Norway Thon Hotels is one of the best represented groups in the city with four hotels and two residences and it is expecting a new high-capacity property in the European Quarter, and even China with the group HNA that took over three properties on the outskirts of the city in 2007 and plans to transform one of them, the ex-Best Western Sode, into a 5* property positioned on the MICE segment. Will it become a base camp for the Chinese lobbyists to the EU? In any case, this project expresses the Asian giant’s interest in the institutional center of Europe. Other actors are preparing their arrival. The Portuguse Tiara Hotels is working to renovate the Astoria, previously managed by Sofitel, which should be completed in 2011-2012. The German Motel One should open with a high capacity economy hotel with 400 rooms in the center of the city. The particularity of these two projects is that they are both located in Rue Royale, demonstrating that it is possible to open a property in the center of a city where the real estate is still affordable and do so across all segments. Even if, in a city where 4/5* properties represent the majority, there are more perspectives on the midscale and economy segments. In the meantime why shouldn’t an opportunity open up for a Four Seasons or a Mandarin Oriental that could join the only luxury group represented, the Rocco Forte Collection, with its Amigo hotel? “If we continue in this direction, it’s feasible. When we do get it, it will be the crown for all the work we have done,” outlines Rodolphe van Weyenbergh.Until this marshal’s staff comes along, the product with the wind in its sails is incontestably the lifestyle product, a positioning that fits the city’s dynamism perfectly. That Starwood has chosen Brussels for the arrival of the Aloft concept in Europe is proof. But preceding it in 2007 was already the hotel Bloom, a contemporary property also located in Rue Royale and decorated by young students from the Ligue Européenne des Instituts d’Art. More recently, last May, the Pantone Hotel was unveiled near Avenue Louise. Designed by Michel Penneman and the architect Olivier Hannaert, the hotel has 59 rooms that use the 7 Pantone color palettes, thanks to a license between the reference brand and the property’s British developer.Brussels is becoming a veritable nursery for innovative concepts. Final proof of this is the Max Hotel which opened last April based on a model similar to Citizen M or Qbic. Assael Lévy, managing director of the family-run group 3 Stars Hotels wanted to be the first to open a budget design hotel in Belgium keeping expenses contained by using check-in terminals and automated food distributors but offering 3* rooms. “This hotel addresses the needs of Business clientele from Northern Europe who are used to this concept, and from Eastern Europe who are looking for a less expensive hotel, as well as young Leisure clientele because we are in the center of town,” explains Anne-Pascale Klerkx, Sales and Marketing director of the group that has three other 3* properties in the city.Could these openings upset a market that is reaching maturity? Most observers don’t think so and are expecting a relatively fluid absorption of these 2,000 new rooms. “With 18,000 rooms, Brussels will have a supply that is almost half that of Barcelona. Its growth potential is big,” estimates Pascal Bontinck. Through an International Development Plan and the revival of “Schaerbeek Formation”, new opportunities for development are opening up in the canal area –with the Atlantis, a 60-room boat-hotel– as well as the Heysel and the Delta areas . But not to hastily… Patrick Bontinck recalls the mistakes made twenty or so years ago when hoteliers raced to establish properties in the center of Europe, leading to a bloody price war and a moratorium to stop the bloodshed.

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