easyHotel adds 300 rooms in Turkey despite low tourist demand

27th Jul 2016 15:55

(ShareCast News) - Budget hotelier easyHotel added a further 300 rooms in its Turkey development despite low tourist demand, while also expanding in Portugal. EasyHotel signed a master development agreement with Kolay, a wholly owned subsidiary of construction and tourism company TOYA, to develop easyHotel in Istanbul, Turkey.TOYA has a portfolio of over 4m square metres of land to develop multiple residential, mixed-use and commercial projects throughout Turkey. Its Kolay subsidiary is expected to open 50 rooms by the end of 2017, and a further 150 rooms by the end 2018. A total of 300 rooms are expected to open by the end of 2019.According to the Turkey's ministry of culture and tourism, the number of tourist arrivals in the country fell by 34.7% year-on-year to 2.48m in May, which was the biggest drop in 22 years, due to security concerns.After July's coup attempt in Turkey, the tourist industry felt a decline in stocks as investors fled from companies linked to tourism. Immediately after shares in Turkish Airlines fell 9% and TAV Havalimanlari, an airport operator, fell 11.8%.The company is also developing a franchise hotel in Lisbon, Portugal with Sedprop Investments, which would add a further 101 rooms by the end of 2017.In Portugal overnight stays by non-residents was up 10.7% in May from the year earlier. Tourism accounts for about 10% of Portugal's gross domestic product.The Istanbul and Lisbon agreements bring the total number of rooms under development by easyHotel franchises to 1,138.Chief executive Guy Parsons said in a statement: "We are delighted to be working with new partners who have local expertise, know-how and property assets in these new markets for easyHotel."We continue to see significant opportunity to expand our franchise hotels network in these and other target markets, enabling us to leverage our brand awareness without direct capital investment."Shares in easyHotel were down 3.85% to 75p at 1640 BST.