4 travnja 2017

Business Model

Having operated on only the Istrian peninsula of Croatia for more than four decades, at the end of 2016 we significantly expanded our business outside Croatia's borders, and we now own, co-own, lease and manage hotels in Germany and Hungary, with the ambition and potential to expand further in these markets and beyond. 

In addition to owning, leasing and managing full service upscale, upper upscale and lifestyle hotels and self-catering holiday apartment complexes in Croatia, Germany and Hungary, we also own and operate eight campsites in unrivalled locations along the Adriatic.

Arena Hospitality Group’s current portfolio is comprised of fifteen hotels, four self-catering holiday apartment complexes and eight campsites, offering a total of more than 10,000 rooms and accommodation units. Most of the hotels operate under one of the two distinct brands, Park Plaza® and art’otel®.

Arena Hospitality Group has considerable experience in managing properties which it intends to apply to leasing appropriate properties from institutional investors and providing a complete property management solution, with expert teams focusing on providing exemplary service and profitable operations. Property ownership, management and management on behalf of owners will become a core part of the Arena Hospitality Group business model in addition to Arena Hospitality Group’s own wholly owned assets.

Owned and co-owned properties

Arena Hospitality Group owns or co-owns ten of the hotel properties, four self-catering holiday apartment complexes and has a 50% ownership interest in two properties in its current portfolio, all of which are operated by the Group. This model is capital intensive but enables us to capitalise on any increase in property values and to develop flagship hotels in locations with upside potential. We will continue to expand the portfolio by acquiring ownership interests in hotels and developing hotels where attractive opportunities arise, especially in locations where capital value is likely to appreciate over time.

Operating leases

The Group leases two properties from third parties: Park Plaza Wallstreet Berlin Mitte and art'otel budapest. In December 2016, the Group contracted to acquire the freehold interests in art'otel berlin kudamm and art'otel cologne, which were previously leased. This acquisition completed in February 2017. Operational leases tend to be long-term arrangements under which we lease a property from a third party for a period up to 20 years. This model requires lower capital investment than owning a property. Within this model, we manage all aspects of the operation of the property, from sales and marketing to reservations, food and beverage and human resources.

Management agreements

Arena Hospitality Group has management agreements in place for all 27 properties that we own, co-own or lease and manage for the property in Dresden that we manage. Management contracts with third parties allow property owners to retain ownership of their property, whilst Arena Hospitality Group undertakes the day-to-day management. We believe that the management model has great potential to realise portfolio growth and are actively seeking opportunities to grow our portfolio through this type of agreement.

Campsites

Arena Hospitality Group's 8 campsites are also situated on the Croatian northern coast.