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No one takes advantage of funds like hotels in the North
European incentives underwrite the construction of 24 major tourism developments
The largest tourism developments funded by Compete 2020 European funds are being built in the northern region, and in the district of Porto in particular. Compete is the largest Portugal 2020 program, lending its support to innovative projects, in which at least €3 million has been invested, in the least developed regions of Portugal, including the North, Center, and Alentejo. Since the program’s inception, Compete 2020 has already approved 24 investment projects, totalling €152 million, for the construction of new hotels and for upgrading and renovating existing hotels. Two-thirds of the projects, and three-quarters of the total investment, are located in the northern region, principally in the district of Porto, which has garnered more than half the projects that are already under way or are ready to break ground. A ranking of projects financed by Compete 2020 shows that nine of the ten biggest hotel developments are located in the northern region and that the five largest are in the Porto district (see table on this page).
The largest real estate development project is Oporto Boeira Garden, a new 5-star hotel in Vila Nova de Gaia, which will receive €19 million in investments. The other four largest developments are located nearby, on the other side of the Douro River: the Neya Porto Hotel (€12.2 million), the Monumental Palace Hotel (€11 million), the Hotel Palácio dos Ferrazes (€10 million) and the Hotel A Brasileira (€9 million). The district is also home to the millions invested in the new Palácio de Canaveses Hotel Resort & Thermal Clinic (€7.4 million), the Vila Foz Hotel & Spa (€6.3 million) and the Goldsmith Hotel (€5 million).
The new hotel units, focused mainly on tourists with greater purchasing power, want to take advantage of the region’s local resources (Port wine, Portuguese filigree, etc.) to differentiate themselves from the competition, targeting the wellness segment (spas) or seeking to innovate in nature-based tourism, with examples such as the FeelViana Ecohotel in Viana do Castelo; the Eco Green Hotel in Ponte de Lima; the Noah Hostel Surf Camp in Torres Vedras; and the five star rural hotel Quinta do Fontelo in Vouzela. The project in Alcácer do Sal intends to increase the capacity of the rural hotel and build new local accommodation units, recuperating degraded buildings in the Herdade da Barrosinha.
Hyper-Premium Segment
Compete 2020 highlights some commonalities of these projects: they are spaces of excellence that feature a diverse set of experiences (history, art, culture, gastronomy and leisure); that are not tied to the seasons, the offer a singular and unique type of service, and which are firmly pointed towards the luxury segment.
Jaime Andrez, who manages Compete 2020, bases the program’s support on two factors: “The first is the importance of tourism to our agenda of competitiveness. It’s a multisectoral activity that mobilizes our architectural and natural heritage and that has effects on other activities, from the furniture to the textile industries, impacting construction materials and construction itself. The second factor is the quality and innovation associated with approved projects that allow us to design new business models, better positioned on the value chain.”
The president of the Portuguese Hotel Association (AHP), Raul Martins, emphasized the relevance of financing in relation to the new hotel investments: “The incentives that come about through community investments and support for improving the supply of tourism projects are fundamental as an instrument to support the financing of hotel companies. While it is true that a large part of the support granted goes to new developments, we must emphasize its importance to the renewal and rehabilitation of existing units, in order to respond to the growing and increasingly sophisticated demand. ”
The head of the hotel group complains about banking guidelines. “”It seems totally unjustified and negative that they serve, as is now the case, to support furnished accommodation for tourists and other short-stay accommodations. Not only is there no shortage of funding in this area, but they also feed short-term and difficult to control market needs, “ states Raul Martins.
Original Story: Expresso – Joana Nunes Mateus
Photo Credits: Rui Duarte Silva
Translation: Richard Turner