Iran, the 18th largest economy in the world, will host the first Iran Hotel and Tourism Investment Conference (IHTIC), a top-level gathering of international investors, owners, operators, developers and government officials.
In addition to rich reserves of oil, gas and metals, Iran has a promising consumer sector with a well-educated population of 80 million inhabitants. There are huge investment opportunities across all of Iran’s economic sectors – energy, mining, hospitality & tourism, fast moving consumer goods, food & beverage, retail, automotive, aviation and manufacturing.
Under the 2025 Tourism Vision plan, Iran is expecting to increase the number of tourism arrivals from 4.8 million in 2014 to 20 million by 2025. The 4.8 million tourists brought around $6.5 billion in revenue to the country despite sanctions and limitations imposed by the EU, the UN and the USA. With the lifting of sanctions in January, it is expected that by 2025 the country will receive $30 billion from tourism income.
Only 13 out of the 96 hotels in Tehran are classified as four or five-star, although it is widely acknowledged that these would not meet internationally recognised standards for such classification.
Sébastien Bazin, Chairman and CEO, AccorHotels speaking at AHIF 2015 said: “The Iranian market is a top priority for AccorHotels, as are Africa and India. These three geographies are ones where I want to make a major push. They have a lot of things in common: civilization, architecture, demography, booming medium-sized enterprises, lack of supply, lack of infrastructure and lack of low-cost airlines”
In 2014, AccorHotels became the first international hotel group to enter the market since the 1979 revolution. Sébastien Bazin said “We are very excited about signing this partnership with Aria Ziggurat in Iran. We are certain that Novotel and ibis will fit perfectly into the growth momentum that Iran’s hospitality sector is enjoying. Our brands are looking at huge growth potential in this country. Our ambition is to develop an important network in the country thanks to our global portfolio of brands covering all segments, from luxury to midscale and economy.”
According to Iran’s Chief of Cultural Heritage, Handicrafts and Tourism Organization, Masoud Soltanifar, investing in the tourism sector has become one of the priorities of the Iranian authorities. The government has provided a series of incentives through the Foreign Investment Promotion and Protection Act (FIPPA) including a 50% full term tax reduction on income, loan structure and eligibility for government funding and property ownership rights.
Other hotel operators have also seen the potential and entered the market already. Abu Dhabi-based Rotana Hotel Management Corp. has signed management agreements for four hotels in Iran – two in Tehran (opening in 2018) and two in Mashad (opening in 2017). Melià Hotels International is planning to open a 319-room hotel in 2017 on the Caspian Sea, with investment coming from a third party, and German hospitality company, Steigenberger Hotel Group, is set to build 10 hotels in different parts of Iran over the next ten years.
Jonathan Worsley, Chairman of Bench Events and founder of IHTIC, said: “I greatly enjoy pioneering new markets; it started with IHIF in Berlin 20 years ago and has continued right through to the Iran Hotel & Tourism Investment Conference in 2017. I believe in Iran’s hospitality potential and whilst breaking new ground is risky with numerous obstacles, those that are first-to-market will no doubt benefit from healthy ROI’s and relationships with both local partners, investors and authorities alike.”