Navneet Bali, chairman of Meininger Hotels, stepped into his role two years ago following the company’s acquisition by Holidaybreak in the UK, and has overseen the company’s growth since then.
At the upcoming Israel Hotel Investment Summit, Nov. 19-20 in Tel Aviv, Bali will present the International Hotelier Keynote: “Why Israel is a Key Market for Hospitality Innovation,” discussing the investment climate available to international hoteliers looking to expand into Israel.
As new airlines bring more tourists to the country, and with supply increasing (albeit at a much slower pace), Bali believes that this is a very exciting and attractive time to enter the hotel market in Israel, especially within the budget and economy sectors.
1. How would you describe the hotel investment opportunity in Israel?
We see demand growth as being positive for Israel with new airlines bringing more tourists to Israel. Supply increases also are taking place but at a slower pace. Overall the supply/demand dynamic is positive for hotel investment. We also feel that the supply/demand dynamic favors the budget/economy or value-orientated customer, for which little supply of good quality exists.
2. What are your company’s plans for the market?
We feel the demand for Meininger‘s unique hostel and hotel hybrid product will appeal to the younger lifestyle segment as well as families. Meininger tends to initially focus on markets where there is demand for both leisure and business travelers. Cities such as Tel Aviv and Jerusalem would be our priorities to start with.
3. What are the biggest challenges faced by international hoteliers looking to enter the Israel market?
In general, international hoteliers need good locations for their existing and potential customers. [These locations should also be] acceptable to their investors from a financial perspective.
Balancing the cost of land on acceptable sites with the return requirements is always a challenge. Therefore, choosing the right model or brand that can provide a superior return is necessary for a successful hotel investment. The hostel and hybrid model, in our view, is ideal from this perspective as it has shown that it provides a superior return while offering exciting customer experiences, particularly to younger travelers.
4. What existing hotel brands or properties do you think are most interesting to watch in Israel?
There are few, if any, quality hotels in the mid-market, economy and hotel/hybrid hostel sectors. We think this represents an opportunity and we would like to see how these sectors develop in the future.
5. What is keeping you busy at the moment?
Meininger opened eight new hotels in the last 12 months, increasing its portfolio from 17 to 24 hotels. Another seven hotels currently are under construction and opening in both 2019 and 2020. This keeps the entire team busy.
6. Who or what is the biggest inspiration guiding your career?
I started my hotel career with the Taj Group of Hotels, which is part of the Tata Group in India. The Tata Group, with its premier position in India, has been a model of integrity with strong employee-related and environmental practices. The Taj Group showed how you could create a quality hotel product with fast growth through a young and dynamic team. Both had visionary leaders: JRD Tata and Ajit Kerkar, who showed how inspirational leadership combined with concern for human values can create successful businesses.
7. What would you recommend a new visitor to Israel to do during their stay?
Visit great and historic sites like Jerusalem and also experience the vitality of the “start-up” country through the wonderful restaurants and bars of Tel Aviv, which creates a vibrant atmosphere.
8. What are you most looking forward to at IHIS?
Meeting local Israeli hoteliers and investors as well as experiencing the vibrancy of Israel as I expect to see in Tel Aviv as well as in visiting Jerusalem.
About the Israel Hotel Investment Summit
Part of the International Hotel Investment Forum (IHIF) series, the Israel Hotel Investment Summit (IHIS) is a two-day conference providing in-depth analysis of the foreign investment opportunity available within the Israel hospitality sector. IHIS will take place at the Hilton Tel Aviv on Nov. 19-20 and will include conference sessions, networking opportunities and site visits.