May the 17th, 2024 – The Croatian Chamber of Commerce (HGK) has entered into the hotel business, looking at activating so-called dead capital.
As Poslovni Dnevnik/Marija Brnic writes, a year and a half has passed since the Croatian Chamber of Commerce opened a public call for interested investors for two large business-tourism projects in the area of Rijeka and Split. The same was also done in Zagreb, but negotiations with potential candidates didn’t result in an agreement and partnership.
The Croatian Chamber of Commerce isn’t going to give up on any of the projects that will compensate for the long-term loss of income after the abolition of mandatory membership either. It’s seeking to activate its dead capital and reduce the maintenance costs of valuable property in both Rijeka and Split.
The Croatian Chamber of Commerce will enter into investments independently. With the conversion of the existing Croatian Chamber of Commerce building on the Split Riva (waterfront) and the investment in the former Panorama motel in Rijeka, it will get two four-star hotels. This was recently confirmed by Croatian Chamber of Commerce vice-president Tomislav Radoš. He explained the reasons for the decision adopted by the Croatian Chamber of Commerce assembly at its last session, which approved the conclusion of the contract between Hotel Panorama from Rijeka and the Chamber on the lease of its office space in Split.
In this way, he revealed, the entire investment project was completed and transferred to the Hotel Panorama company, which is 100 percent owned by the Croatian Chamber of Commerce, and which owns the Rijeka motel. That company will therefore take over the operational management of the investment project, because the Chamber as such doesn’t directly deal with company and investment affairs.
The company that will take over all commercial activities, Hotel Panorama, currently has no activities, employees, or income, and its revival and project management will facilitate procurement and all other activities in the Chamber’s hotel business. This, it is estimated, will achieve a significant synergistic effect.
How much the Chamber will have to invest in starting its own hotel business, according to Radoš, “hasn’t yet been defined”. In the case of the Panorama motel, it’s worth noting that a decade ago, it was declared a cultural asset by the Ministry of Culture, as the ultimate achievement of high modernist architecture.
That motel was built back in 1965. Not all of the buildings were completed, and in the meantime, after the departure of the exiles from the Homeland War, they remained empty, neglected and ruined. A few years ago, the Chamber started with the arrangement and clearing of the grounds and the preparation for investing in the Mediterranean Education Centre of Excellence. That was originally planned to be established with the aim of educating personnel in the hospitality and tourism industries.
For the new project of renovation of the Panorama motel and arrangement of hotel facilities, it’s still necessary to complete the project documentation and the final cost sheet, and the values will also depend on whether the existing building will be restored. This is a typically more demanding and financially difficult procedure. It also needs to be seen whether it will be removed and rebuilt according to original project. Radoš confirmed that the Croatian Chamber of Commerce has recently started the process of amending and supplementing the building permit for the Mediterranean Educational Centre of Excellence project.
Pure hotel content is foreseen for the reconstruction and revitalisation project of the Panorama motel, which bears the signature of the well-known Rijeka architect Idis Turato. According to him, the ‘new’ Panorama should have a total of 56 rooms. The Chamber of Commerce hopes that the works will start sometime this year, as soon as all the conservator’s approvals and the green light for construction are received.
At the same time, activities will be launched to prepare for the Chamber’s building in Split to be converted into a new hotel. It is currently in its design phase, so the activities “on the ground” will probably follow only next year. That building, a beautiful almost century-old stone palace, is in excellent condition, renovated and well maintained. It currently houses the Split County Chamber. The idea is to convert it into a luxury hotel of smaller capacity, boasting 21 rooms.
Although the Croatian Chamber of Commerce is still not talking about the value of these investments, estimates that were used unofficially at the time of the launch of the tender for the selection of potential investors a year and a half ago, ranged around a total of 20 million euros for Split and Rijeka.
It would be logical that these figures will now be somewhat higher. That’s because the aforementioned estimates were made from the period before the big price increase in the construction sector. They were also made before the change of purpose of the building in Rijeka. The entire burden of the project will be borne by the Croatian Chamber of Commerce itself. In addition to all of the above, the implementation of the project in Split foresees the resolution of the relocation of the County Chamber and its ten employees to a new location, which still needs to be secured and financed.
These two hotel projects are in gorgeous locations, on Matejuška in Split and an attractive position along the Adriatic highway (Jadranska magistrala). The latter is right on the border between Opatija and Rijeka with a magnificent view of beautiful Kvarner. They will provide the Chamber with long-term income, and it is estimated that they will create 70 new jobs. Radoš pointed out that the project of both hotels is being conceived as sustainable tourism, which will connect hotels and local producers, OPGs (family farms) and use all of the available potential for a circular economy.
