Greece's neighbors now feeling sting of debt crisis

It's not only Greece that is suffering from the current debt crisis. The country's neighbors are, too, particularly as tourism wanes. The escalation of the debt crisis has sparked fears of contagion in neighboring countries and across Europe. Bulgaria, for one, is already feeling the impact.

In Sandanski, a town in southwest Bulgaria, contagion is already real, as Market Watch reports. The small city is known for its thermal springs and caters to Greek visitors. But now there are fewer Greek tourists. Last year, more than 150 buses packed with Greek visitors arrived here every weekend. Reportedly, there are now only two or three.

Greece is top of mind for many hotel investors and will be a focal topic during the 2015 Mediterranean Resort & Hotel Real Estate Forum (MR&H), Nov. 9-11 at the NH Collection Madrid Eurobuilding. More than 40 industry leaders have already been confirmed as speakers, including: Taleb Rifai, Secretary-General of the World Tourism Organization; Hervé Louis, CFO of AccorHotels, Africa, Middle East, Indian Ocean and Caribbean Islands; Keith Evans, VP of hotel acquisitions for Starwood Capital Europe Advisers; and Federico J. González Tejera, CEO of NH Hotel Group. For a full listing of speakers, panel sessions, registration and further information on the conference, visit www.mrandh.com.

Bulgaria's economy, which has grown around 1 percent anually since the global financial crisis in 2008, is deeply intertwined with Greece's. The country sends around 7 percent of its exports to Greece. Greek-owned banks control more than a fifth of the country's banking assets.

For now, local banks are weathering the capital controls imposed on their Greek parent firms, and the Bulgarian National Bank assured last week that actions by the Greek authorities "can in no way affect the smooth functioning and stability of the Bulgarian banking system."

"We've seen about a 70-percent drop in deals with Greeks since 2012," said Mariana Angelieva of the real-estate broker Address. "Few can afford to buy property anymore."

Hotels have certainly been hit. As Market Watch writes, Karamfilka Hristova, manager of the Sveti Nikola hotel, said the number of Greek guests has fallen by about a fifth compared with last year.

"Before the crisis, groups of Greek tourist used to check in every day. Now if a group comes in once a month, we count ourselves lucky," she said.

Hristova has now turned her attention to attracting Russian tourists. "Now that the Greeks are gone, I hope the European relations with Russia will improve," Hristova said. "The Russians are our last chance."