The InterContinental Hotels Group (IHG) has signaled its intention to expand into emerging markets in Russia and the Commonwealth of Independent States, with the announcement of plans to open 100 hotels in the region by 2020.
Speaking from Moscow, the company’s chief executive for Europe Angela Brav said that the company hopes to create around 8,000 new jobs for Russian and CIS country’s citizens, joining a staff of more than 2,500 who are already employed at IHG hotels throughout Russia and the CIS. Currently, IHG operates 11 hotels in Russia and 5 in other CIS countries.
IHG’s foray into the Russian market began back in 1998 with the opening of Moscow’s Holiday Inn Vinogradovo. Thirteen years on, the company is now prepared to expand into fast-emerging cities including Yekaterinburg, Novosibirsk, Samara and Chelyabinsk.
Aron Libinson, IHG’s Russian/CIS development vice president, said that “The aim is to multiply our presence in the region six-fold over the next ten years.”
Libinson stressed that the company had every reason to believe demand for IHG brands would increase, due to the rise in both domestic travel and the numbers of foreign tourists and businesspeople visiting the region.
Angela Brav, who is in Russia as part of a trade mission accompanying UK Prime Minister David Cameron, said that IHG saw huge potential in the country.
“We see a huge opportunity to grow our hotel brands, such as Crowne Plaza and Holiday Inn, in Russia. We want to help bring people from around Russia and the rest of the world to experience the country’s rich cultural heritage and natural wonders, from Red Square and the Kremlin in Moscow to the stunning Lake Baikal in Siberia”
Both of IHG’s premier hotel brands have already established themselves in cities such as Moscow and St. Petersburg on the Baltic Coast, but Brav said that there is enormous potential for further growth in the region. She pointed out that Moscow especially suffered from a shortage of international standard hotel rooms, with just 9,000 compared to the 90,000 available in London.
One of the first projects in the pipeline for IHG will be the biggest Holiday Inn in Europe once it’s constructed. The company is teaming up with the Crocus Group to build a 1,000 room hotel, which should be completed by 2014.
Hotel Indigo, the newest hotel brand under IHG, is also set to make an entrance in Russia and the CIS. The company sees huge potential for the boutique hotel chain, which affords guests all of the services and benefits they expect with more established hotel names.
The InterContinental Hotel Group currently operates 11 hotels in Russia, providing a total of 3,397 rooms, while it has a further 5 hotels with 1,123 rooms in CIS countries. As of now, plans for the development of a further 8 hotels with 2,636 rooms in Russia are under way, together with another 2 hotels and 435 rooms under development in CIS countries.