The Ataköy district of Istanbul, Turkey, is poised to get a new $450 million mixed-use development that will include a Jumeirah hotel and 62 private residences managed under the Jumeirah brand.
The developer, Turkey’s Kuzu Group, has appointed Jumeirah Group, a member of Dubai Holding, to operate the property in the Sea Pearl development, which is anticipated to open in 2019. The 202-room hotel will be Jumeirah's second in Istanbul, following Pera Palace Hotel Jumeirah. The company also manages the Jumeirah Bodrum Palace on the Bodrum coast of the Aegean Sea.
But with all of Turkey's recent problems, the development of a new hotel may be premature. Cetin Osman Budak, a lawmaker from the Republican People’s Party and former head of the Chamber of Commerce in Antalya, Turkey’s most popular resort city on the Mediterranean, called the country's tourism outlook “quite bleak,” and noted a 40-percent drop in reservations from Europe based on early bookings. Some seasonal properties in the resort town of Kemer did not bother opening this year. “Even big companies are keeping half of their hotel-chains closed because hotel managers are finding it harder to pay back loans,” Cetin Osman said.
The government is trying to minimize the financial fallout by letting banks twice restructure as much as $17 billion in loans to tourism-related businesses before declaring them non-performing. It is also offered to pay salaries of 45,000 tourism workers for three months.
Source: Bloomberg