Académique Documents
Professionnel Documents
Culture Documents
November 26 , 2006
Partners: PhD Miroslav Dragicevic, PhD Sanja Cizmar, Rubinka Vlahov - Petrovic, BSc. Pink Herceg, BA. Director: PhD Sanja Cizmar Company name: Horwath and Horwath Consulting Zagreb ltd Registration number: 0484075; Activity code: 74140, Account: 2360000-1101208153, Zagrebacka Banka Zagreb
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1. Terms of Reference
1.1. The Subject of the Contract
Within the public tender issued in June/July 2006, public company 'Palic - Ludas' has elected Horwath Consulting to perform the work on the project development for tourism complex Palic. Agreement concluded in July 2006 specified the following project tasks: - Project task no.1: Situational analysis with market analysis and benchmarking of a subject site, - Project task no.2; Making the best using concept including market positioning, product development proposal and conceptual design of area scope - Project task no.3: Project management strategy, which includes checking the economic cost and profitability of the project (prefeasibility level).
This document is a draft proposal of the final project report presented to the Client, and which is after discussions and manifestations of interest-involved entities subject to further adjustments and amendments.
For the realization of the mentioned project task, we relied on secondary and primary market research conducted for the Master Plan of Tourism of the Republic of Serbia.
2. Summary
2.1. Purpose
The final project report draft of integrated Palic resort near Subotica is presented here. This is a project that follows international standards of planning and development of the resort at the level of an average of four international stars, and as such represents an important and innovative step forward for tourism in Vojvodina and Serbia. This report represents the basic situation analysis, market research analysis as well as a detailed proposal of the concept and strategy of the project with a score of key economic and financial effects. The report also suggests the best way of realization of this project through basic proposed management model. The aim of this project is focused on the current resource base objectivity of Palic area and its possible conversions into the relevant international SPA resort. Findings of our comprehensive analysis are positive, although we believe that this project will not be possible without the strong support of the public sector in Subotica, Vojvodina and the Republic of Serbia as a whole.
context, it is particularly important to emphasize the following: - Serbia has a relatively stable domestic currency exchange rate and economic stability. - Serbia has a substantial balance of payments surplus, and for the first time in more than twenty years, it begins the strong support for the development of general and especially tourist infrastructure of the country. - Serbia particularly encourages domestic and foreign private investments, and it is at the complete level of the privatization process. - Although there is a problem with the educated workforce or labour in tourism, for the tourist projects that starts there is sufficient professional staff and which is more important for Serbia , labour mobility started in accordance to the opening of the labour market and there is flexible working legislation, too. - Palic is a traditional tourist destination in Serbia and Vojvodina, well known beyond their borders. - Palic is easily accessible of transportation, and considering the proximity of Subotica (7km) available to all public functions that provide security and protection of the interests of potential guests. - The relevant development of Central European destinations similar to Palic has already started in the wide surroundings, so project Palic is imposed as a necessary and Vojvodinas first serious step towards high-quality and internationally acceptable tourist industry.
In our opinion, there are all relevant market conditions for professional starting of project Palic, and in addition, public support to launch the project is clearly visible in accordance to international practice in the development of tourist resorts.
Location due to its internal characteristics and in particular geostrategic, in our opinion, has all the prerequisites to, provided with high-quality development, become one of the competitive tourist destinations in Central Europe in a relatively short period.
The already analyzed performances of some major domestic destinations and hotels located in them, suggest that today Serbia is realizing in some cases over 20 thousand Euros of annual revenue/income per room, despite the fact that hotels are not essentially renovated nor market repositioned. In this context, our suggestions on engagement and average prices for the planned
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hotel facilities in Palic are positioned at the level of competition currently present in Central Europe and decreased by 15 to 20%.
Concerning model destinations from abroad, we took into account those that reflect the following important characteristics: - All destinations originated from 19th century and their modern development in the last 10 to 15 years was based on the tourist products palette expansion and providing a complete value chain destination, in order to work throughout the whole year. - All destinations operate as an integrated system of products and services where the interests of the involved public and private entities are optimized by destination management organizations. - The accommodation structure is mostly diversified by type and category of accommodation, it is maximally adjusted to demand, and specialization in pricing is more and more visible as well as specialization in key market segments. Therefore the hotel level of quality at all destinations benchmarked, mainly focuses on two categories (4 and 5 *), while the third category (3 * and below) is on the minimum possible level. - Destinations are organic blend of cooperation between the private and public sectors, including tourist projects, that is, the functioning of competition and marketing clubs. According to the published prices shown above, as well to databases of Horwath Consulting on realized prices during the year, The following features of these destinations could be noticed: - Implemented prices of 5 star hotels range from 120 to 150 Euros - Implemented prices of 4 star hotels range from 80 to 120 Euros -Implemented prices of 3 star hotels range from 60 to 80 Euros
- Implemented prices of basic wellness treatments range from 30 to 50 Euros - Implemented prices for daily meals depend on the category, range from 10 to 30 Euros per person - Implemented prices for high-quality bottles of wine, depend on the category range from 30 to 50 Euros - Implemented parking fees, depend on the category range from 5 to 15 Euros per day.
All these and other analyzed standards are set as an enter limit for the project Palic and its appropriate competitive round, and afterwards development time and market adaptation.
European Union; The rate of economic growth in Serbia and Vojvodina will be in the range of 5 to 6 percent on average per year, and reach the average GDP per capita in the range of 7 to 9 thousand Euros, and Vojvodina will be at the upper limit. Serbia and Vojvodina will be using stimulative and development funds, particularly for infrastructure, agriculture and the important tourist projects. The domestic market of tourist travels will be significantly expanded, particularly short weekend trips as it is common for the rest of the countries in the region. Strong international technology transfer in the hotel business will occur, especially considering management and distribution. Serbia and Vojvodina will become recognizable actors in the European tourism. Domestic market will develop a significant range of differentiated tourist offers including at least twenty internationalised tourist destinations. Palic will in very short period become even more competitive tourist destination similar to today's lake / SPA destinations in Central Europe. Palic will become a model destination in Serbia and Vojvodina, and thus reasonably become part of the competitive round of destinations / resorts in Central Europe. As Pannonia SPA destination and icon for the key values of active relaxation and health in this part of Europe, Palic is internationally recognized as a year-round SPA and wellness destination. Through its protected natural and cultural environment, Palic offers
unique services in the following key experience areas: - SPA / wellness, - Meetings, Conferences, Incentives and happenings/events, - Gathering and maintaining family ties, - Summer and winter sports / recreational activities, - Culture, inheritance, gastronomy. In its market positioning, Palic particularly emphasizes the following: - Value orientation through experiential positioning carefully constructing complete chain of values (professional specialization); - The creation of the emotional charge and the reasons to re-return to Palic (guest loyalty); - A unique interaction of all elements and concepts realized as small lake Riviera model and created as lake promenade ("Lungo lago"), and - Separate access to different areas of experience (low universes for themselves).
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This ratio is characteristic for similar SPA resorts in Central Europe, although Hungary has made a step forward considering larger share of foreign markets. If Serbia achieves by any chance significant specialization in the area of the SPA tourism, it will be possible for the project to significantly increase Palic s foreign tourist turnover share.
Considering the high share of infrastructure investments and the fact that resort investments are associated with large investments in long-term tangible property, the project has a bit higher investment index per employee. The project demonstrates good performances of the investment relations towards newly realized revenue/income and added values. Overall, this project is challenging and demanding one, and its professionalization process from the initial to the final phase is inevitable . Like any other tourist project breakthrough that happened in surrounding countries, this project also requires external assistance and special capacity-building activities of local forces towards its effective implementation.
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ACCOMODATION ATRAKCIJE& Conference hotel Palic Golf Palic Lake Apart hotel Palic Park Apart hotel Palic Apart hotel Palic Small tavern Apart hotel Palic Family hotel Palic Wellness hotel ACCOMODATION TOTAL ATTRACTIONS Golf court 18 holes Palic golf club Grand terrace Concert terrace on the lake SPA aqua world Land of enjoyments Entertainment Park ATTRACTIONS TOTAL RECREATIONAL FACILITIES Womans lido Marina and water sports centre Tennis courts Lido Childrens swimming pools Thermal pools Promenade Esplanade RECREATION TOTAL COMMERCIALS Palic villas Annex Family hotel - Apart hotel Apartment buildings/sports Shopping arcade Csarda/typical Hungarian inn COMMERCIAL TOTAL INFRASTRUCTURE Soil preparation Road construction Electricity, gas, telecommunication Water supply and sewerage
IN EUROS
15.000.000 115.888.000
KEY INVESTMENTS 24.399.297 OTHER INVESTMENTS 5.500.000 B. NEWLY CREATED VALUE/ADDED VALUE IN EUROS 29.899.297 TOTAL KEY INVESTMENTS OTHER INVESTMENTS C.EMPLOYMENT MAJOR PROJECTS SMALL PROJECTS INDIRECT PERSONELL TOTAL D. INVESTMENTS IN EUROS PUBLIC PRIVATE PUBLIC/PRIVATE TOTAL Investments per employee/labour KEY INDICATORS: Investments/ revenue/income Investments/newly created value/added value 14.981.708 2.400.000 17.381.708 460 130 220 810 20.800.000 73.588.000 21.500.000 115.888.000
143.072 3,88 6,67
48.000.000
A A B B C C
TOTAL
B A D D D D All B
5.100.000
A C D A F
22.688.000
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REPUBLIC OF SERBIA
General information
\\\\ Capital: Area: Population: Exchange rate:
Belgrade 88.361 km2 7.463.157 (Jun 2004.) 1 EUR = 84,60 CSD (Aug 2006.) 2001 10.661 1.421 5,5 40,7 40,2 1,0 2.834 3,2 1.169 11.948 26,8 2002 14.282 1.904 4,0 14,8 46,7 4,2 3.908 10,0 2.280 11.839 29,0 2003 18.984 2.531 3,0 7,8 46,1 3,8 4.847 9,1 3.550 14.241 31,7 2004 21.771 2.903 9,3 13,7 46,0 2,5 7.047 13,2 4.244 13.555 31,6 2005 23.685 3.158 6,5 17,7 45,0 2,2 5.546 10,0 5.842 11.605 29,2
Economy indicators:
GDP current prices (US$ mil.) GDP per capita (US$) Real GDP growth (%) Inflation and of period (%) Public consumption (% GDP ) Fiscal deficit (% GDP) Trade deficit (in mil. US$) Payment balance sheet deficit (% GDP) NBS foreign currency reserves(in mil. US$) External debt (mil US$) Unemployment rate
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Sources: NBS, Ministry of Finance, RS, SIEPA, CIA World Fact book 2006
3.2. Vojvodina
In addition accessing Serbia by road, railway and air, for Serbia , river transportation is also very important (Sava, Danube, DanubeTisa-Danube). The navigability of the Danube in the whole length (587 km)is undoubtedly the major economic potential.
AP VOJVODINA
General information
The Capital of the province: Area: Population : Number of settlements: Novi Sad 21.506 km2 2.031.992 (2002) 467 President of the Assembly of AP: Bojan Kostre Chairman of the Executive Council AP: Bojan Pajtic
3.1.3. Economy
In Serbia , during the period 2001 2005, the GDP per capita ( based on PPP) increased from 1.421 US$ to 3.158 US$ , the average wages/salaries for the same period increased from 91 Euros to 209 Euros, while the country foreign exchange reserves increased significantly and at the end of 2006 they reached the level of 6 billion US$ , with a tendency of continuous increase. Inflation was mainly curbed, while the dinar exchange rate was stabilized. The value of exported goods and services gradually increased from year to year which should resulted in gradually reduced todays growing foreign trade balance deficit within the future time when the privatization process completes.
3.2.1. Geography
Vojvodina is situated in the very north of Serbia, and it is defined as multi-ethnic and multi-confessions territory of all its citizens . It extends in the southeastern part of the Pannonian plain within the area of 21 506 km2 and population of more than 2 million people. Geographical region is predominantly lowland divided into Srem, Banat and Backa by intersected rivers - the Danube, the Tisa and the Sava, which are linked with numerous channels and represent the largest hydro potential of the region. Novi Sad, which is the administrative, cultural, educational and economic centre, is the capital of the province. Vojvodina administratively consists of 7 districts : Novi Sad, Subotica, Zrenjanin, Kikinda,Pancevo,Sombor,and Sremska Mitrovica, with the total
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number of 45 municipalities. Temperate continental climate with cold, dry winters and hot and humid summers is typical for the region .
towards manufacturing industry (39%), agriculture (20%) and trade (16%). Hotels and restaurants in the same year participated in GDP with 1%. Structure of gross domestic product in Vojvodina 2003
Source: CBS RS, 2005 There were 537,146 persons employed in Vojvodina in 2004 and that number represented 64,6% of the working age population. 294, 071 unemployed persons were registered at the same year, which represents the rate of unemployment of 35.4%. Similar as in case of the contribution to national income, employment follows similar structure, and about 75% of employed persons are in the sectors of manufacturing industry, agriculture and trade.
3.2.4. Economy
After Belgrade, Vojvodina, is the second most developed region in Serbia. It participated in gross national income of the Republic of Serbia (2004) with about 30% or 268.2 billion RSD. Structure of gross domestic product shows Vojvodinas orientation Page 14
3.3. Conclusion
Serbia and Vojvodina are on a transitional turning point. The fast and positive changes happen in the development of the business environment in which Serbia recorded a big jump considering world competitiveness ladders. On the other hand, Serbia has slowed down a little its negotiations with the EU, considering the requirements of the EU that Serbia must comply with - the Hague Tribunal. Regardless of the internal political conflicts associated with remaining internal problems of Kosovo and recently with Montenegro, it is certain that Serbia has been greatly stepped on the road of European democratic and economic processes, as can be evidenced by numerous international affairs that took place in Serbia and active relations of Serbian companies in the wider region. Mentioned steps could especially be noticed as a fact that Serbia increasingly opens towards tourism through special incentives for encouraging development of tourist infrastructure offered by the government. Serbian Government has recently adopted National Tourism Development Strategy, which proposed strategic investment projects, and in fact indicates that Serbia seriously acknowledges tourism as an important factor of its economic growth in the near future. In that context, the project Palic is one of those development tourist projects through which Serbia and thus Vojvodina, may be the right ones to count on considering quick rehabilitation of the international market and the development of modern tourist offer in accordance with Central European cultural tradition.
Source: Municipalities in Serbia in 2005. The region of Vojvodina in 2003 made investment of 1.3 billion RSD of which the most within manufacturing industry, trade and energy sector, which together participated in the total of the investment of 67%. Other sectors are at a low investment level especially hotels and restaurants that participated only with 0.5% of the total amount of annual investments.
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Nature Park Palic It seizes an area of 713 ha with protective zone of 869 ha. It also includes protected area units of cultural-historic heritage that together with urban and physical structures contributes to the protected natural goods value. Lake Palic represents protected goods foundation. Apart from autochthonous natural resources, preserved park area with various decorative dendroflorum and decorative annual and perennial species, which enrich the natural goods volume are situated in Nature Park. The Municipality of Subotica made a decision that establishes three-mode protection regime. The strictest regime, the first degree of care, where no exploitation or use of, covers 88.5 ha (12.41%). Second mode regime with a limited use, covers 78.1 ha (10,95%). Regime of controlled use, level III protection , covers 546.4 ha (76.64%) of the total area of the Nature Park "Palic. The lake and the situation with the lake Palic are considered as the typical Pannonian, shallow, steppe lake, which was in its natural state salted. The present form is a secondary water. Biotope with arranged water regime, and it is a subject to a
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number of negative influences from the environment and therefore become significantly degraded. The shape of the lake is crescent with branches facing north and west. The lake area is about 5.7 km2. The minimum width is 300 m and length is 8250 m. The bottom of the lake is relatively blurred, depth ranges from 1.5 to 2 meters, and at some points, and the lake is much deeper. The lake itself is under strict protection. According to the annual report - Palic lake water tests conducted by the Institute for the Health Protection Subotica, the following conclusions are stated:
Transportation network
- Palic is unstable ecosystem with large quantity of sludge which significantly impacts the quality of water; - The average concentration of total phosphorus in the water of Lake Palic, except in the tourist area, are significantly high and almost unified for sites. They are suitable for intensive and organic production with all the negative consequences for the lake; - The amounts of waste waters coming to the purifier and far exceed its capacity, are over-burdening the lake; - The water in the tourist part of the lake is of II and II-III-class quality.
Imminent reconstruction of wastewater purification and channelling waste device/instalment, should provide water with minimal content of organic matter, compounds of nitrogen and phosphorus.
In terms of traffic, Palic SPA area and the entire lake are linked, connected to the wider surrounding coming from the north via the northern loop of E-75 highway and through the main transport direction of M-22, to southern and southeastern surrounding through eastern loop highway connecting to the main road M-17. The existing street network is orthogonal and following streets are the most important features: - Horgoki put street - through which passes the main direction of M- 22.1 - Kanjiski put street - the local road route Subotica - Kanizsa, - The bypass around the lake - from Kanjiski put over recreation centre up to the junction of Main Road M-24, - Josef Hegedia street - link between Horgoki put and western and southern parts of the Grand Park, - Split street alley - the closest connection between Horgoki put and eastern and southern parts of the Great Park, - Rijecka street with the coast of Lajos Vermes - service street for supply and access to contents while the coast of Lajos Vermes is strictly pedestrian zone.
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Water Supply
Water supply network is designed so that it plays a role of water supply and fire fighting protection, too. Supplying the city with water is done from water intake II (Subotica), and also from the wells in the immediate close to hydro-globe. Hydro-globe is of a capacity of 2,000 m3 with pumping station and a new bored well. A major water supply network was built in diameter of 250ka from the hydro-globe towards eastern and northern bank of the lake, which is connected to the water supply network of the Grand Park, and the water tower located at Horgoki put street. Primary water supply network was built in the form of ring, where most of the buildings in the tourist zone are connected to the public water supply network. Thermal water is exploited through water pipes to Lake and Park hotels, and serves exclusively for their needs.
with about 6 new pumping stations is planned. It will go to the eastern side of Palic Lake in order to join the collector A directly in front of the purifier . Beside these collectors , the public sewerage system network in other streets (outside the tourist zone) is not built therefore drainage of wastewater from existing households is solved mostly individually by septic tanks. Electricity, gas and telecommunications network
Unlike the town of Subotica, Palic has a separate system of construction of sewage, where the atmosphere used water is collected separately. The entire drainage network gravitates toward Lake, which is the main recipient of consolidated wastewater from the surrounding settlements. Collector "A" as a major collector of faecal, residential, and industrial waters , extends along the E-5 road to the purifier built on Salt Lake. Collector "B" collects and drains the used water from the tourist zone on the western and northern bank of the lake Palic. The construction of the collector "C" Page 18
In the area ,within the plan of a detailed regulation , electric power system network of 12 transformer stations at both voltage levels (35 and 110 kV)was built. The telecommunications network was partly built overhead and partly underground and meets the current peak capacity. Gas network is connected to city gas pipeline ring through control - regulating station (MRS) Palic and the network is conducted through the area of the tourist zone, while the rest of the lake does not have gas network. The Palic telecommunications system is connected to the main digital central station in Subotica through nodal exchanges. So far, the Palic area settlement has built cable - distribution system that distributes radio and TV signals. The reconstruction of the main Station building is expected and also construction of protruding lower level switching nodes, in order to build a network of optical cables and connectivity in large CATV networks.
Functional units around the lake Palic Space between Youth and Palic Lake - the east coast area of Palic Lake has no other objects built but the hotel Prezident and mounting facility of meteorological station. This Space is generally disorganized, and partly used as a parking lot (by Mans lido).
Park and the coast The Great Park was formed as an integral part of the tourist - SPA and pool complex in the mid-19th century, and was reconstructed in the early 20th century, and in such form it is kept on up to today. Within the park, the oldest SPA facilities are located - Administrative Building of PC Palic - Ludas, Lake and Park hotel, Water Tower, Grand terrace. There is a tennis club facility in the northwestern part of the park , which is surrounded by tennis courts. Near the tennis club , there is Summer stage built in the 50s of the 20th century. A nursery with ancillary facilities is located in the western part. The coastal zone is Women's bathroom and facilities are built in the late 19th century in the western part of the coast, in coastal area: Bagoj var, Riblja Carda/fish csarda, and Louise Villa and Vermes villa. In the eastern part there is a small restaurant called Mala gostiona/Small tavern and hotel Prezident.
Mans lido - in the area there are ruined buildings of changing rooms, outdoor built thermal pool , and a part of the Space toward bypassing road is used as a car-camp, which is currently disorganized.
Sports - Recreation Centre are located in the south from Mans lido. There is existing sports and recreation centre as part of which Sports facilities are built - outdoor basketball, volleyball, and football field, with supporting facilities - changing rooms, indoor bowling alley and attached catering facilities (restaurants Log Cabin and Fountain) and the hotel Sport that is not in use.
ZOO The ZOO is located in the western part of complex and it was formed in 1950. Along the south edge of the Zoo , objects were built in the function of housing .Defined number of objects is among the oldest built objects in Palic. Thanks to numerous adaptations, their original appearance and identity were lost.
Weekend housing project There is ,south from sports - recreation centre a structure of objects aimed for housing and recently constructed and of questionable quality of planning, architectural and visual solutions.
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tourism, public greenness - parks, green protective - protective green belt and commercial functions. For the a/m block the obligation is determined to make detailed development plan of regulation, considering the importance of Space included, in order to define regulation within the block and defining the conditions of planning and constructing in accordance with the purposes and specific contents of particularly specified purpose entities Palic SPA, tourist, hotel and sport - recreational facilities, with the new facilities interpolation into protected parts of the premises, in accordance with the guidelines given by GP in case of care of natural and immovable cultural property, as well as construction conditions for facilities operating in the part of the block intended for commercial functions.
Category
Present state
Present state
Subotica is 7 km away and all necessary public and other services exist there.
Location accessibility
Palic is in the very near of highway E-75, and near two major border high frequency crossings
Accelerated development of all types of personal service activities inside the project zone .
Security
Water, gas and electricity are relatively good covered around the tourist zone, while the sewage system is of lower quality Completed infrastructure with all necessary facilities ,including sewage system .
Infrastructure
Public transportation
Public transport exists : buses, railways and taxis, and is of satisfactory quality
In addition to improving conditions on the roads, raising the quality level of local public transportation
Lake
Present situation with the quality of water in the lake is poor ,and is one of the key barriers to tourism development.
In the medium term by building purifier and implementing the sewerage system network it is expected to have improved water quality
The site is located near several attracter (town of Subotica, Kelebija, Zobnatica, nature reserves )
Visibility
The project has a good visibility primarily due to mainly low construction style (P +1 + Pk), but also because of the Water tower at the entrance (symbol)
Architecture
Most buildings are built in secession style or style of "neosecession" except Weekend housing project areas which architecture and planning are of questionable quality
Detailed regulation plan is expected for the weekend housing project that will partially repaired the situation
Accommodation
Accommodation structure is not in function of modern resort and is a very weak point in the form of international tourism.
Development project in this category can be bridged and set standards at the international level
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After the important elements evaluation we can evaluate the location as following:
PRESENT STATE VL L N D VD
accommodation that are not in the function of modern resort, and b) The lake itself and the quality and ecological values of water. We believe that the eventual project development of tourist complex Palic , in the medium term, will possibly significantly improve the structure and quality of the mentioned accommodation. However , the lake remains a key issue, especially due to the fact that we are talking about large and continuous investments in order to enable the lake to become main attraction of Palic destination. Even if the quality of water achieved Water Class I - II, and after the construction of purifier and sewage system network around the lake, due to the changed market, lake water for itself is not anymore and neither can be the only attraction force of the future Palic resort.
CATEGORY
Location accessibility Infrastructure Lake Visibility Accommodation Services in the region Security Public transportation Attractions vicinity Architecture
FUTURE STATE VL L N D VD
VL: very bad; L: bad; N: normal; D: good, VD: very good As a result of the above evaluation, it can be concluded that project has two serious weak points as follows: a) Inherited accommodation structure and quality of Page 22
compete with other project features in order to reduce negative impacts or aspects of the location.
According to the standards mentioned above and location qualification categories ,Horwath Consulting Zagreb estimated the location of the project development of tourist complex Palic as Location level B, remarking that Project has the potential to be improved to the Location level A. This potential arises from the fact that it is already began with building of waste water purifier and that there are plans to build a complete sewage system network around the lake, and it is estimated that the mentioned will provide a new additional impulse for future projects development. This qualification also means that the project already has strong points in its availability, visibility, security and architecture near the project. Besides mentioned, it should be taken into account that this project will finally be able to defend the destination from urban pollution attacks private homes for vacation construction.
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KEY ADVANTAGES Palic has historical BRAND image and does not start from the beginning; Palic is well located (access, distance of the major markets, visibility, elevation); Palic is located in proportionally quality local and regional market environment Palic has a strong cultural background and a story that has marketing value; Palic is a part of Subotica with which it complements to offer experiences and residential contents; Palic has the support of local community on his way of market restructuring. Palic has historical image at the level of brand Palic has a chance to develop a complete range and not start from the beginning; of destination values with year-round operating Palic is well located (access, distance
of the major markets, visibility, elevation); Palic is located in relatively quality local and regional market environment
KEY DISADVANTAGES
Inherited suprastructure is unavailable as modern tourist resort; Dominance of beaches, resorts and private houses for vacation compared to the market forms of tourist offer; Ecology of the lake and the surrounding area and continuous threat of illegal construction within wider area of the lake; Lack of Palic centre, the reason for mixing the public urban functions with tourist resort and recreational functions; Landscape planning and urban goods of the resort / destination planning; Underdevelopment of products and activities as stimulus for businesses growth; Marketing and sales of resort mainly at the local market; Underdevelopment of the existing businesses that are not able to take responsibility for growth and modernization of the resort.
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5.MARKET ANALYSIS
5.1. Domestic market and competition
5.1.1. Accommodation
- Registered 85,867 tourist beds of which 54% were hotel facilities that is a good accommodation structure according to international examples of structures (hotels make up 60-70% of total capacity);
- Nearly 90% of hotel capacity were of the lower level (1, 2 and 3 stars), which is todays key problem of Serbia in attracting international tourism;
- Vojvodina participated with 9% of the total accommodation capacity and represents the lowest developed region considering accommodation availability in Serbia;
- However , Vojvodina has the largest number of hotels with 4 and 5 stars beside Belgrade, as well as the relatively largest number of restored hotel objects, which indicates that this market revitalizes faster than the Serbian market .
It is clearly visible that the Subotica Palic accommodation structure , in both quantity and the quality does not give the character of significant international tourist destination. Moreover, at the basis of the Palic key accommodation structure, that includes Hotels Lake, Park and in particular, Prezident, a mark that Palic is still far from having arguments for serious international competition , is created. It is known that only strong hotel offer and related value chain around it (of services and activities)provides an importance on local and international markets to a destination.
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The main features of the tourist turnover in Serbia were: - In 2004, there were registered 1.97 million arrivals and 6.64 million overnight stays, of which about 80% of arrivals was realized by local guests; - The most important foreign markets in 2004 were : BH (11.8% of total nights), Czech (8.5%), Germany (6.5%), Norway (6.1%) and Italy (5.4%); - Foreign guests structure was distributed into the large number of markets with low participation in the total number of nights, which generally refers to fact that Serbia had business turnover, and less of typical tourist turnover - Vojvodina participated in total turnover of Serbia with 12.1% of arrivals and 10.3% of overnights, and therefore it is at least developed tourist region in Serbia according to the amount of visits and tourist nights; - The average retention of guests in Serbia and in the region of Vojvodina and Subotica, is according to our information unified and the average stay is about 2.2 days, which is again proof of fact that it is mostly a matter of business turnover, less than traditional tourist one. Tourist turnover of Subotica and Palic: According to basic accommodation structure, Subotica and Palic realise modest results of the tourist turnover. According to tourist bureau of information of Subotica and Palic, business passenger tourist turnover is a dominant one. The guests stay something over two days. It is also visible that Page 27
2003 International 2,943 3,276 6,219 36,928 Domestic 11,394 13,496 24,890
2004 International 3,930 4,144 8,074 32,964 Domestic 11,578 21,154 32,732
2003 International 6,769 6,880 13,649 80,128 Domestic 26,206 28,342 54,548
2004 International 9,039 8,702 17,741 72,289 Domestic 26,629 44,423 71,053
Subotica has a much higher turnover than Palic . However, all of the mentioned says that this whole region considering its geo-traffic location and attractions (Palic and the town of Subotica) has not far taken advantage of its capabilities. In this context, any possible further detailed analysis of the local market that is based on the past few years, has been unnecessary, because does not even remotely reflect the state of the former, nor especially state expected in the future.
Total annual income per room and average hotel overnight price by clusters
TI per room (in Euros) Average overnight price (in Euros)
BUILDING
20.000
Key products: MICE* SPA Mountains
Every sixth hotel conference and fitness contents Every tenth hotel sports facilities
80 70 60 50 40 6.053 30 4.361 3.599 20 16,4 10,4 10 7,9 0 Vojvodina Belgrade SW Serbia SE Serbia 16.537 72,6
20
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- In the Serbian hotel offer the most of facilities are of middle and lower category and they require reconstruction and restoration as well as introducing of new contents in order to successfully compete on demanding international tourist market; - Serbian achieves 28% of annual occupancy of capacity and has 102 days of full occupancy. Vojvodina in this category has the best results with 117 days of full occupancy (better than Belgrade); - The total average annual income per room in hotels in Serbia in 2004 was 8423 Euros, Belgrade has two times higher results than the average; - In accordance with the realized income are also levels of average overnight price in Serbia, from 17 to 73 Euros, the average for the Serbia in whole - 27.1 Euros.
Considering the need for evaluation Span of the planning elements of future destination Palic income, we analyzed the situation and realized prices in today's key Serbian tourist resorts: Kopaonik, Zlatibor, Tara and Spas (Vrnjacka and Sokobanja). These are destinations with gradually restored hotel hardware and where privatization is in the process of implementation and there is also general revitalization of supply and services. We have chosen three destination objects from the mentioned competitive round above:
- Competitive-level hotels are of 4 * and 4 * plus quality, and besides accommodation and food and beverages they offer other contents ranging from conference room, outdoor and indoor swimming pools, sauna, fitness, recreational and other contents; - The largest volume of business they achieve during summer and in winter, their capacity utilization rate is between 50 and 60%, they also realize average (net) prices in the range of 25 to 65 Euros per sold room, and their average (net) income is in range from 9 to 25 thousand Euros per room.
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Demography
Number of older age category persons will significantly increase. Seniors would be healthier and they will possess higher income than before.
The growing demand for quality, convenience and safety, for easy transportation and for relaxing fun, as well as for products especially designed for single persons. Higher demand in the pre and post season.
The average number of persons per household will continue to decrease, which will result in higher disposable income and purchasing power.
The growing demand for luxury, for special products that can be obtained by spontaneous purchasing, the short vacation products and other short breaks abroad - in periods that were previously less used.
Health
Destinations that are perceived as less healthy will be more avoided than in the past. The demand for holidays in the sun will continue to decline, while the Active Holidays popularity will grow. Demand for wellness products will grow also, including SPA and fitness centres.
The growing demand for special products. Prominent involvement of elements concerning the arts, culture and history into tourist packages and vacations organized on their own. The need for better and more creative communications and information transmission . Demand for new destinations in CEE will grow. The growing need to supply additional low cost products.
Modern society encourages increasing pressure on the daily lives of people and stimulates the desire to increase the time to rest and relaxation, which will have stronger effect Page on free available income growth.
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Major consequences for tourist sector Alternative ways of implementing leisure time and spending money compete with the rest conduct, and during the implementing rest the preferences towards different destinations and types of accommodation are changed. Demand for destinations that do not meet acceptable standards will significantly decrease, which will happen during longer periods in the future. Different ways of behaviour: one holiday is spent easy going, the next one in luxury - this year is going to be distant destination, and next year we will go to a close destination. Preferences for the conduct of annual leave will become more fragmented in the future, which will affect as often vacation repetition. Destination loyalty will continue to decrease over the next years All visitors will be more experienced and with more critical attitude toward artificially created values, and all will be more in more favour of authenticity. Regions that offer a complete, different, very balanced concept will be more preferred, and will require better destination management.
Information technology
Penetration of the Internet and its use for the purpose of information and purchase of tourist products and services continue to grow.
Direct availability of tourist information about destinations and products, and growing search sophistication in the information analysis will enable comparisons, thus affecting the competition more intensively. Experienced tourists will increasingly structure their own holiday on a modular basis with direct booking. The role of travel agents will be reduced, since tourists will purchase packages directly through the Internet. Internet would rapidly transform the classical role of national tourist organizations, but will also create a new role in e - marketing, including the implementation of CRM (customer relationship management ) in the destination marketing. The availability of in-depth information on products, available through links or destination pages, will become increasingly important as a basic prerequisite for the success of a web page.
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Key tourist trends in Europe Trend Transport Increase of the availability of high-speed trains and low rates air carriers will affect the classical mainstream travel. Road transportation will face even bigger crowds. Major consequences for tourist sector Destinations will benefit from easy and cost acceptable availability for implementing short breaks, especially when important events are organized outside the main season. The growing availability of direct rail and air links will encourage international demand for short vacations in cities and urban regions, at the expense of rural areas. Reduction of major holidays in favour of shorter breaks during the year.
Sustainability
Higher demand for sustainable destinations, in which nature and population play an important role. Regional components within destinations will grow. Destination management terms should be improved through more coherent and consistent planning.
Security/Safety
There is growing need to feel safe and protected because of terrorist acts, regional wars, pollution and other crises that have become part of everyday life.
More critical tourist will not hesitate to complain if offered product does not meet expected standards.
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In terms of quantitative trends in 2004, Europe had a market share of 54% in world total tourist arrivals, having 415 million international arrivals. In the period 2002 - 2004, international number of arrivals in Europe grew by a moderate average annual rate of 1 to 5%. In the region of Central and Eastern Europe 68 million tourist arrivals were recorded in 2003, where the leading countries in the region were Hungary(16 mil.), Poland (14 mil.) Russian Federation (8 mil.) and the Czech Republic (6 million).
5.3. Benchmarking
According to market analysis, and particularly local situation in Serbia considering similar projects it could be observed that the majority of projects are planned in the medium and long-term are correlated with domestic market growth, which is currently limited in relation to higher and medium categories of products. Benchmark analysis shows examples of best practices and models that project Palic should certainly respect and in relation to the mentioned should differentiate in quality. Namely, to be successful in the market, the tourist project Palic with creative copying can in the foreseeable future, certainly reach standards of the mentioned resorts. However, it is not enough. Beside the implementation of approved recent planning , development and management standards, project Palic must know how to successfully differentiate with respected regional competition, and thus to achieve some kind of
market advantage. Taking this into account, and as an additional argument for proper planning and development of project Palic, we took into account project cases that were established in the Central European region and have developed organically in line with market growth. In accordance with a model, projects selected into the competitive round are selected on the basis of the following criteria: - Vision and structure of each project, - Level of attractiveness of researched sites (resources and attraction basis) -The type and structure of accommodation facilities, - Product structure, and - General level of quality service. Below, we provide an overview of selected benchmark projects:
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PROJECT DEVELOPMENT OF TOURIST COMPLEX "PALIC" Final report Region with lake, which offers different types of vacation based on recreational Complex type:
activities, spa/wellness, gastronomy, golf, congresses and events.
Location: Positioning:
Austria is in the north of Burgenland, near the Hungarian and Slovakian border, nearest towns are Vienna and Bratislava Personal approach services delivered to guests, families and business tourism, highlevel recreation, natural beauties, culture and gastronomy. Families, children, sportsmen, business people Golf Cycling tracks Team parks Football stadium Climbing tracks Indoor-outdoor pools Archery cross-country hiking Nordic skiing Health centre Swimming Water sports Surfing fishing
Neusiedler See
Description:
Hotel Inn Private rooms Farms Rest houses Cottages and hostels Cafe Night club Gourmet restaurant Snack / Fast Food Disco Wine tavern Tavern Bar Restaurant Confectionary/ pastry shop Golf court with 18 holes is in Donerskirhen, near the Lajthagebirg Mountains. Specific location and climate. European Challenge Tour 1994 and 1995 Golf academy Golf club and golf house Different types of massages Cosmetic treatments Thermal and health baths Wellness and Beauty centre Great number of fitness centres with different offers Exhibits Music events Sports events Entertainment Religious events Field trips Lectures Area - 315 km Max. depth - 1,8 m Average depth - 1 m Water quality salt and sediment Well known region for wine, a lot of vineyards National park
GASTRONOMY
GOLF
EVENTS
LAKE
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OTHERS
Town at three borders, well known for two lakes Faaker and Ossiacher, near mountains and rivers. Austria, in the south at border with Slovenia. Population of 58 000, town at 500 m latitude. Klagenfurt is the closest town and airport, 40 km away. Villach friendly town, interesting because of its culture, art, fitness, wellness summer and winter sports activities, gastronomy and multiculturalism. Families Children Sportsmen Business people Wellness Fishing Curling Beach volley Ice skating Golf Bowling Roller skating Riding Cycling Snow walking Swimming Skiing Sailing Climbing
Villach - Warmbad
Activities:
Description:
Hotel 5 stars - 1, 4 stars = 16, 3 stars= 13 Inn Private rooms Farms Rest houses Cottages and hostels Cafe Gourmet restaurant Snack/Fast Food Confectioneries Pizzeria Bar Restaurant Disco Two courts> Alpe Adria Golf Villach and Warmbad Golf Camp Alpe Adria 18 holes, near the lake Faaker Warmbad Golf Camp, golf school , tennis and hotels Thermal and health resort, 7 hotels of different categorizations Therapy SPA and beauty Rehabilitation Sports activities Exhibits Music events Sports events Entertainment Religious events Field trips Lectures Faaker See - area 2.2 km2, max. depth 29.5 m Ossiacher See third large in Karintiji Well known place for cyclist gatherings 3 close Nature parks
GASTRONOMY
GOLF
EVENTS
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LAKE OTHERS
Balaton
Activities:
Description:
Hotel Inn Rooms for rent Youth hotel Camp Restaurants Csard Pub Confectioneries Taverns Beaches/Strands/Lidos SPA Beaches Different types of massages Cosmetic treatments Wellness body treatments Hair salon Possible conference organizing in one of the hotels Club Tihany /150 persons capacity Danubius Thermal Hotel Hvz****superior Capacity of 600 persons Kayak rent Pedal rent Rent of Sailing boast, boats for fishing and cruising Low budget hotels Houses for weekend
GASTRONOMY
SPA
EVENTS / CONGRESSES
MARINA
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Activities:
Bled
Description:
Apart hotel Camp Board Private rooms and apartments Youth hostels Bar Restaurants Taverns Confectioneries Teahouse Cafs Offered in lot of hotels Wellness centre Bled Sauna and fitness Indoor and outdoor pools Beauty salons Congress centre on the lake max. 500 Hotels Sava (5 hotels) max. 350 Hotel Best Western Compass max. 150 Hotel Lovec max. 100 Congress organizing in congress centre Albatros, Bled Tourist farm Hotel*** Hotel**** Hotel*****
GASTRONOMY
SPA
EVENTS / CONGRESSES
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Karlovy Vary
Activities:
Description:
Apartment Camps Private accommodation Hostel Hotel Bar Beer pub Caf Confectionery Fast food Garden restaurant Balneal - therapy Rehabilitation, medical experts SPA company SPA hotel - complete SPA treatment SPA hotel - local SPA treatment Offered in hotels Park hotel Richmond capacity 250 Hotel Thermal*** Grand hotel Pupp Karlovy Vary Hotel** Hotel*** Hotel**** Hotel***** Lodges Restaurant Pizzeria Pub Catering - receptions Restaurant Tea room
GASTRONOMY
SPA
DOGADAJI / KONGRESI
With a general overview of the characteristics of each of these examples, the best practice, we explored the price categories of accommodation facilities, focusing on hotel accommodation.
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PROJECT DEVELOPMENT OF TOURIST COMPLEX "PALIC" Final report P A L I C - Benchmark Analysis Competitive set
Overnight in double bed room with breakfast minimum CEKA - Karlovy Vary 1. SPA & Golf Resort Hotel Esplanade ***** 2. Hotel Nov Lzne ***** 3. Falkensteiner Grand SPA Hotel **** 4. Hotel Villa Butterfly **** 5. Hotel Vlatava-Berounka *** MADARSKA - Balaton 1. Plus Palace Thermal Golf Club Hotel ***** 2. Best Western Janus Atrium Hotel **** 3. Danubius Health SPA Resort Hvz **** 4. Danubius Thermal Hotel Aqua **** 5. Hunguest Hotel Helios *** AUSTRIJA - Burgenland 1. Reiter's Supreme Hotel ***** 2. Reiter's Avance Hotel & Resort **** 3. Golf & Thermenresort Stegersbach **** 4. Golf & SPA Hotel 'Das Gogers' **** 5. Balance Resort Stegersbach **** AUSTRIJA - Koruka 1. Warmbaderhof Kur- Golf- Thermenhotel ***** 2. Karawankenhof Thermenparadies **** 3. Hotel Pulverer Thermenwelt ***** 4. Club Landskron **** 5. Falkensteiner Hotel Carinzia **** 108,00 EUR 67,00 EUR 71,00 EUR 99,00 EUR 79,00 EUR 112,00 EUR 99,00 EUR 122,00 EUR 69,00 EUR 137,00 EUR 79,00 EUR 82,00 EUR 133,00 EUR 119,00 EUR included 7,00 EUR 11,00 EUR 15,00 EUR included 15,00 EUR 14,00 EUR 89,00 EUR 98,00 EUR 79,00 EUR 67,50 EUR 97,00 EUR 102,00 EUR 108,00 EUR 90,50 EUR 121,00 EUR 123,00 EUR 102,00 EUR 79,50 EUR 107,00 EUR 10,00 EUR All inclusive 19,00 EUR 29,00 EUR 15,00 EUR All inclusive 55,00 EUR 50,00 EUR 52,00 EUR 43,00 EUR 42,00 EUR 80,00 EUR 88,00 EUR 72,00 EUR 55,00 EUR 49,00 EUR 170,00 EUR 115,00 EUR 82,00 EUR 68,00 EUR 75,00 EUR 20,00 EUR . 14,00 EUR 14,00 EUR 13,00 EUR 40,00 EUR . 30,00 EUR 15,00 EUR 28,00 EUR 59,50 EUR 70,00 EUR 69,00 EUR 45,00 EUR 41,00 EUR 85,00 EUR 80,00 EUR 83,00 EUR 59,00 EUR 52,00 EUR 155,00 EUR 96,00 EUR 92,00 EUR 68,00 EUR 63,00 EUR 9,00 EUR 8,00 EUR 25,00 EUR 9,00 EUR 45,00 EUR 18,00 EUR 9,70 EUR 18,00 EUR 16,00 EUR average
maximum
From the selected benchmark projects, for project Palic can be summarized following important conclusions: - All destinations originally came from the 19th century, and their modern development in the last 10 to 15 years, was based on the range expansion of providing tourist products and on providing a complete destination value chain in order to operate throughout the year; - All destinations function as integrated systems of products and services where the interests of the involved public and private entities are optimized by destination management organizations; - The accommodation structure is mostly diversified by type and category of accommodation, it is maximally adapted toward demand and price specialization as well as key market segments specialization, and is more and more visible. So the level of quality hotels in all benchmarked destinations mainly focus on two categories (4 and 5 *), while the third category (3 * and lower) is on the minimum possible level; - Destinations are the organic combination of private and public sector cooperation through tourist projects ,therefore functioning of the competition clubs and marketing; - According to the published prices shown above, as well as Horwath Consulting data base on realized prices during the year, the following characteristics of destinations can be observed: a. realized prices of a 5-star hotels range from 120 to 150 Euros; b. realized price of a 4-star hotels range from 80 to 120 Euros; c. realized prices of the hotels with 3 stars range from 60 to 80 Euros; d. realized prices of basic wellness treatments range
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from 30 to 50 Euros; e. realized prices of daily meals depending on the category, range from 10-30 Euros per person; f. realized prices of quality wine bottles, depending on category, range from 30 to 50 Euros; g. realized prices of parking, depending on the category range from 5 to 15 Euros per day.
Comparing these standards with today's Palic situation is obviously not possible. However, it is certainly important for project Palic to know where the current round of competition today is, and what are the requirements of business that wants to be incorporated in the future business part of this project. Therefore, below the strategic vision of the project, which obviously cannot be done in short time, is presented below. Today it is important to establish standards that in the medium and longterm implementation of this project must be followed.
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defined in accordance with the provisions of the Suboticas General Plan/ Master Plan Subotica;
- Palic therefore developmentally represents a key challenge to Subotica leadership as well as to Public Company Palic-Luda. They both have to respect internationally based standards of tourist resorts management, but they should also differentiate them according to recent experiences in the development of the lake plain resort area of Central Europe (Austria, Hungary, Czech Republic, Slovakia, and Slovenia)
- Resort Palic, as part of Subotica municipality, is undoubtedly one of potential leaders in tourism in Vojvodina and Serbia. This is a resort of the historical profile, but it is also a resort that should be modernized necessarily and radically. It is also necessary to expand accommodation capacity by designing new and relevant tourist products,
- After more than 150 years, when it began to form as Palic SPA, the local beach and a place of public and cultural life of this area, it is obviously time for this resort to modernize, bearing in mind its inherited natural and cultural assets,
- Such a general vision is of a great interest for the Municipality of Subotica that wants to open new Space for development, investment and employment using revitalization, restructuring and newly built contents and capacities in Palic.;
- The concept of Palic modernization, which is defined by this project, is put into the context of the environmental model of Central European lake resorts and Spas. It should be taken into account the fact that Serbia and Vojvodina walk towards European integration even more faster, and that purchasing power of the domestic market as a potentially important user is growing;
- In that sense already developed urban plan for the northern zone Palic that covers an area from the main road through park to the weekend housing project on the east side of the resort. The rest of the lake Palic has yet to be urbanisticlly
- Finally, some particularly built examples of tourist offer in Serbia and Vojvodina recently, are in a fair manner of European hotel building and service culture.
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In this regard, based on research conducted by Horwath Consulting and Faculty of Economics in Belgrade in connection with key value attributes of Vojvodina, is derived as follows:
Vojvodina is the region marked as healthy nature of well known Panonian plain whose past is old and rich. Vojvodina respects traditional values, it is people warm and cosy, therefore nice for people staying.
Vojvodina , with its authentic towns and places, represents an dreaming and romantic destination. It has water wealth, healthy food and high-level security staying that makes it very worth to travel to.
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All of these basic values are applicable for the Subotica region too, but due to needs of differentiation, here is particularly important to emphasize following values: - Rich past, - Authentic place, - Romantic and comfortable. Palic undoubtedly belongs to the Central European experienced region of plain lake holiday and SPA places, which are in such a modernized edition present on the market last twenty or more years. However, Palic, if it wants to enter the market, which offers this type of experience, beside the modernization of the accommodation and other offers for market differentiation, has to play on the card of rich history, authenticity of Vojvodina small towns as well as romance and comfort of a resort that was established 150 years ago.
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Nature Rivers (Danube, Tisa) Lakes (Palic, Luda) Fruska gora Mountain Deliblatska sandy terrain Geo-thermal waters Rare birds specimens Karadordevo Upper Danube flow/ Podunavlje Forests
Culture Monastery -churches Museums, galleries and ateliers Town centres/ old towns Castles and farms of Vojvodina Csarde/typical Hungarian inn Nave art Activities Hunt Fish hunt Equestrian sports Cycling Bird watching Boat ride, jeep ride, etc. Eco safari Summer eco camping Field trips
Events EXIT festival Novi Sad Film festival Palic Duijanca /Harvest festival Vintage festival Festival of Childrens theatres National minorities festival Country ceremonies (celebrated days)
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Structuring and combining value attributes with the physical and spiritual attractions is of special interest to the articulation of each individual future tourist projects in Vojvodina. As part of Serbia, Vojvodina undoubtedly has all the prerequisites to become easily recognized tourist region on the regional and European markets. It is therefore particularly important to start discussions as soon as possible and make a decision on a complete market positioning, that is the brand of Vojvodina at international and regional tourist market. Without such a regional tourist brand, and wider Serbian tourist brand, Palic project as well as other potential tourist projects in Vojvodina will be limited. It is not enough only to Proposal market position of Vojvodina as a basis for starting build hotels, to provide access, infrastructure and make promotion. construction of its complete and consistent brand looks It is important to have a brand as a universal element of recognition as follows: Key benefits Differentiation Image in the market.
Water experience of Pannonian plain 1. Water experience 2. Pannonian life style / way of life 3. Small romantic destination in the middle of the continent 1. Multiculturalism 2. Pannonian plain 3. Life on water and near the water
Namely, in order to help promotion of the project Palic at regional and European market, consumers need to have marketing sensibility for tourist Vojvodina. In other words, they need to know what are the possible experiences they can have upon arrival to Vojvodina. They also have to know how Vojvodina differentiates in relation to competition, what its image like is, and finally what is its tourist identity. Therefore, Horwath Consulting assumes that prior to implementation and promotion of project Palic, Vojvodina will initiate a comprehensive project of market positioning/branding, as it is proposed in the Master Plan of Tourism of the Republic of Serbia where the Vojvodina is one of four defined tourist clusters.
Vojvodina plays on the card of the wealth of rivers and canals connected with the nautical tourism, land and underground waters expressed as spas and well-diversified attractions and activities of special interest that are permeated by urban structures, farms and csards. Central identity Water-rich Pannonian pleasure
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6.5. Vision
Bearing in mind the broader context of development project Palic, that is, the framework for complete construction of the future market position of Vojvodina and Serbia, it is possible to define the development vision of the project. It is defined for a period of next 10 to 12 years. Serbia and Vojvodina will become recognizable actors in the European and domestic tourist markets with the bulky choice of differentiated tourist offer in at least twenty internationalised tourist destinations. In a less than ten years, Palic will become a competitive tourist destination similar to today's lake / SPA destinations in Central Europe. It will develop a modern hotel and other accommodation offer, activities and services of average level of 4- international star hotel and provide business during the whole year. In realization of this vision, full cooperation of public and private sector will be achieved in order to provide sustainable development in the long term. There shall be the world's relevant planning and development methodology for tourist projects and competing applied / transparent access to Investors acquisitions and operational management. Palic will become a prominent destination of Serbia and Vojvodina, and thus it will reasonably be part of a competitive round of destinations / resorts in Central Europe.
In 12 years, Serbia and Vojvodina will be an integral part of the European Union having stable political and economic system, thankfully to implemented reforms of adjustments. In the same period the rate of growth in Serbia and Vojvodina, will be in the range of 5 to 6 percent in average per year, and will reach the average GDP per capita in the range of 7 to 9 thousands Euros, and Vojvodina will be at the upper limit. Serbia and Vojvodina will be beneficiaries of incentive and development funds, particularly in infrastructure, agriculture and the important tourist projects. The domestic market of tourist travels, and especially short weekend trips will be significantly expanded, as in other countries in the region. Strong international transfers within hotel technologies will occur, especially in the management and distribution.
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Internationally recognized as a year-round SPA and wellness destination that emphasizes content for Meetings, Incentive stays and events/happenings, it builds in particular its sports profile.
- Orientation of values through experiential positioning of carefully constructed complete value chain (professional specialization);
- The creation of the emotional charge and the reasons for the rereturn to Palic (guest loyalty);
Through its protected natural and cultural environment, Palic offers a unique service in the following key areas of experiences:
- SPA / wellness,
- A unique interaction of all elements and concepts through model of small Lake Riviera and the creation of the promenade ("Lungo lago");
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Spa / Wellness
Relax Young Comfortable Elegant Romantic
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health, and to install in it facilities for meetings, events and sport. The following facts must be taken into account: -That this task should be achieved in a space that has a rich past and that it is about an authentic and romantic place; -That this task should be achieved in the area of about 500 ha with inherited property, infrastructure and handling model that no longer meet the time requirements; - That this task should be achieved in conditions where significant part of the area is devastated by wild / uncontrolled construction, without any treatment of waste water and where in the long term probably the swimming dimension as an attractive lake magnet for tourism will be lost; - That the intervention of new construction and rehabilitation that have to happen will assume the historical shift in the local understanding and usage of the lake as a passive local beach and landing that has just a little tourism.
Taking this into account, in order to realize a vision of Palic in accordance with the positioning to become one of the competing SPA and relax resort in this part of Europe, and thus significantly contribute to development of the local welfare, into account must be taken at least following conditions / assumptions:
- Creating a competitive resort Palic is not possible through small corrections, repairs, renovation and construction of additional minors;
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- Creating a competitive resort Palic is not possible to perform on the rehabilitation of traditional product rest beside the lake, with the dominance of local users and weekend visitors in relation to modern tourist demand, the concept that works in recent fifty years; - Creating a competitive resort Palic is not possible without expansion of the regulating and development impact on the complete space around the lake and at least 500 and possibly up to 1000 m of the coastal line of the lake; - Creating a competitive resort Palic is not possible without significant change of the current business mission of the Public company "Palic-Luda" which is the company having a conflict of interest; - Creating a competitive resort Palic is not possible without a complete shift of values and respect of the rules of the game of modern tourist industry.
Starting from such knowledge, we approached the realization of the vision and the concept of positioning by structuring an integrated tourist resort.
In our previous discussions with the political structure and management of public company on these assumptions we spoke on couple of occasions and there was expressed approval of the aforementioned conditions and assumptions that must be respected because of the wider development interests of Municipality of Subotica.
This means that guests to whom experience of a market-oriented position is aimed to, must have more than the expected benefits of practicing activities as a reason why they choose Palic as the destination, This resort has to offer them: - Emotions associated with the romantic tradition of Palic; - Feeling of relaxed traditional countryside of small lake Riviera; - Isolation in their small universes of experience, but also planned and meaningful character of the chosen place without conflict with the title of the needs and demands of guests; - Easiness of the access, information, activities and unique resort concierge system; - And finally, a unique animation, entertainment and events that are directed for creation of continuous residence ceremony feeling in the resort.
Merging these principles with a vision, positioning and key areas of experience, and our proposal is to structure Resort Palic: - Into five key and professionally designed products, and
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The product concerns good healthy clients who are looking for treatments that will enable them to maintain that status. They are looking for better health, reduction of excessive/over weight, reducing the effects of aging, reducing pain and discomfort, removing the stress, which are the main motives for choosing this product.
With these products, Palic resort counts on a special product interest, but that product will not particularly be explained here, because it is an integral part of managing a complete offer and topic of creativity of future resort management.
The chances of this product in Palic are as follows: -There is a historical connection with this product because Palic was recognized as monden spa 150 years ago; - There is a thermal source of water that can be used for this purpose; - Product SPA / wellness becomes a general trend in tourism; - Major shift from the typical female product to men users and the whole families; - Demand for SPA / wellness products is constant throughout the year; - The level of price is on average higher than for other products, and is typically above 100 Euros per user for basic service.
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The product includes individuals who travel to particular destination for professional reasons. On the other hand, MICE product represents the organized form of travels associated with business motives. This product includes, therefore, all persons with commercial motives, the exception of workers on temporary work (become, be part of the labour force in the other destination). Sub segments of this product are individual business travels and meetings, motivation (Incentive) trips, seminars, educational programs and trainings, conventions and corporate business meetings, business fairs and exhibitions. Palic has a good chance in this product because: - Very good traffic situation; - As every Euro spent by the participants generates additional 8 to 12 Euros; - A significant level of loyalty of the participants who return to a vacation destination; - A strong impact on trade; - The extended value chain, with links to many tourist products.
Tourist Centres at lakes in the last 15 years intensively develop in a way that their facilities and programmes are put as an offer throughout the year. Programmes are composed mainly of a set of various resort and recreational activities, depending on the annual time. Tourist Product of the lake can be divided into summer (June to September) and winter holiday/vacation (from October to April). Usual summer activities are: "Sun & lake" summer programmes (swimming, sunbathing, wellness), hiking and nature activities, cycling, paragliding, kiting, water sports and activities (sailing), and horseback riding. Usual winter activities (if you exclude activities related to mountains) are the following: hiking, skiing, skating, and curling. Palic may be eligible because of the following facts: - Favourable climatic conditions for the tourist offer throughout the year; - Summer Vacation on the lake is the primary alternative to holiday at sea; - Winter vacation has the focus on the quality of offered services and activities, compared to the traditional winter holiday in mountains, which focuses on quantity; - The main market segments are families with children; - A wide range of offered products and activities.
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4. Short holidays/vacations/breaks
for business or commercial reasons, which creates a growing market for Travelling for sports reasons.
Short vacation usually lasts between one and four days, sometimes longer, and it is the second, third or fourth holiday of the year. Main motives for short holidays are hideaways and escapes from daily life in the atmosphere of model resort (couples), job (small groups and individuals), events (groups and families), culture, shopping etc. (organized groups). This tourist product has not seasonable character, primarily because it is linked to six of the above-mentioned motives of arrival at destination, but it is very elastic in relation to price. Short Vacations in Palic have a chance because of the following: - The world trend of taking more shorter holidays (2 to 4 days); - The fastest growing tourist product; - High revenue per guest; - Fast and easy way of putting the destination to the regional tourist map.
5. Sports
The exact definition of sports tourism does not exist, but there are activities such as participation, presence, organizing, practicing or watching sports. Thus it can be pointed out that sports tourism includes all types of active and passive participation in sports activities, unorganized or organized in the form of vacation ,
There are three different groups in which sports tourism can be divided: - Active sports tourism - people who travel to participate in sports competition or preparing for it; - Event sports tourism - which involves people watching sports or having a desire to compete at the event ; - Nostalgia or historical sports tourism - includes people visiting places and objects associated with sports events, persons or circumstances. Palic has the following opportunities in sports tourism: - Sports activities have always been an integral part of the Palic offer ; - Increased demand for sports facilities with complete supply in summer and winter months; - Great funds are spent on sports events, sports associations and teams; - Significant advertising, promotion and activities associated with sports events and competitions; - Increased chances for increased level of amateur participation due to aging population trends, growing income intended for leisure activities, and increased awareness about health and culture of life.
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Portfolio of tourist products considering segments, suprastructure / infrastructure, distribution and promotion
Product name Product segment Tourist suprastructure / infrastructure Promotion and distribution
Short vacations
Groups Individuals
Individual business trips and meetings Motivation (incentive) travels, seminars, educational programmes and trainings Conventions and corporative business meetings Business fairs and exhibits "Sun & lake" summer programmes (swimming, sunbathing, Wellness) Hiking, Nature activities Cycling, paragliding, kiting Water sports and activities in water (sailing, rowing) Cycling, kiting Sledging, Ice skating, curling Club SPA Cruise ship SPA Day SPA Destination SPA Medical SPA Mineral springs SPA Resort / hotel SPA Active Event Nostalgia
Airports Hotels Shopping Museums, theatres, cinemas Restaurants, bars, Discothques Airport 4 and 5*hotels Conference centre Fair Modern A/V equipment Hotels, private accommodation Activities centre with all included services Sailing equipment and water Activities Restaurants and bars Spas Mineral water Medical institutions/hospitals Hotels Private accommodation Shopping Restaurants, bars Hotels, private accommodation Sport- recreation centre with all supporting services Complete sports equipment Restaurants, bars, Entertainment
Tour operators brochures Internet portal destinations Emitive markets vicinity Global intermediates
Planners of meetings and organizators Business convention biro destinations Hotel chains Tourist Agencies Tour operators Internet
Health tourism
Sports
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A1 - Golf course with 18 holes On the west side of the lake (mostly agricultural land with only small number of residential and weekend houses) we suggest the construction of modern golf course with 18 holes and driving range. The total area of golf courses would be about 73 ha. The planned golf course will be on the location that according to our knowledge has only about 30 ha of public land, beside the use of regulation plan for this area, it is very important to start resolving ownership issues in advance.
The proposal is that this zone should be structured in the area of minimum of 60 and up to 80 hectares and to be along the lake. This project is of combined purposes (mixed use) and is proposed primarily because of the need to reduce risk for the construction of golf and top hotels.
Following the golf course, along the north side , we suggest a modern hotel that in the annex has a golf club (subject to further explanation), which is positioned as a full service hotel with 4 - 5 international stars. Hotel that is proposed is a kind of luxury hideout, which is intended for the following key market segments:
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formed. Villas will be of high-level planning(each with a swimming pool), and there will be three types of villas, total residential area (120, 140 and 170 m2). The sale of villas, will reduce the risk of investors connected with the need of normalization of ultimate hotel business market in Serbia and Vojvodina that will last at least 5 to 6 years.
Hotel would contain 168 hotel rooms with modern conference contents in the form of multifunctional space that can be shared into several individual rooms.
A5 - Marina and Aquatics Centre A3 - Palic golf club Within this strategic area on the shore of the lake, the centre for water sports with a small sailboats marina will be located. This site as well as concentration in one place of all the local clubs affiliated with water sports is the added attraction of the project and contributes to its image and marketing synergy. Namely, the activities of local clubs, possible competitions, happenings and events, as a rule are accompanied by local and general public interest. So, the location of this content close to the golf area, with the extension towards the women's strand (Womens lido) makes it ideal not only for spatial dimensions, but above all because of necessary socialization of the housing project/settlement in order to create social clichs that significantly contributes to the marketing synergy of the Palic Resort.
Formulated as an annex to the golf hotel, we propose the construction of golf club, which will consist of two parts, the public one and one for members only. Because of the members, we suggest that with the launch and construction of golf course start initiative to form a Golf Club Palic on the usual system of initial membership / fee in order to finance the construction of golf.
A4 - Palic Villas
We suggest that on the outer edge of golf course (west side) a series of 50 villas should be
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concerts as well as formal and plenary meetings (facilitys First floor). In his left wing, entrance is proposed to be a reception / cloakroom with toilet block, and the same space would serve as an entrance to the main hall. In the right wing of the ground floor, we suggested the Park 1840 Lodge with a small offer of food and sweets, which would serve the rich equipped and attractive terrace. The Basement part of the building would have only storage and service content. In cultural terms, and terms of service offer, this area will became a cult-meeting place in the open air and as it in its unique central location, park and architectural merits.
B2 - Women's lido/strand
We suggest that due to the tradition of this content, it should be thoroughly renovated and converted into a modern club that would remain regarding its original function. Locker/changing room model would remain, and be used by the club grounds. Its inner sunbathing part would be expanded to the water by added wooden platform.
B1 Great terrace
In this very area, it certainly must not be possible to realize the swimming pool project already proposed by the Regulation plan draft especially for the following reasons:
We suggest the facility conversion Into the prestigious event centre for exhibitions and closed
- Loaded infrastructure (transport, of supply, etc.). - Lack of settlement sense of peace in the central part of the day;
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- Jeopardizing other projects and their business missions that should not be confused with the possible creation of public beach feeling in the best part of the resort. Although the purpose of this proposal is that the same content in slightly stronger commercial version remains for the use of local population, it must not turn into mass gathering place due to the revitalizing area of Mens strand/lido with that particular purpose.
B3 - Concert terrace on the lake Park and Lake should be changed into Apart luxury hotels with a total of 42 accommodation units. Beside household contents, both the objects will have petty small kitchens for preparing breakfasts, concierge system, reading room and room service. We propose the construction of new building, which function will be within the complete thematisation of this area. It is about wooden construction on the lake that has double function. During the day, it is a sunbathing area, and later on, it becomes a place for the evening classical music concerts, fashion shows and other unobtrusive and not too noisy events. Together with the womens strand, this construction makes visual balance of the north promenade of the lake as a principal/main place for gathering people We suggest that as the annex to Small tavern an additional Apart hotel of 20 units should be built, and through which the Small tavern will take over the role of a central object in the input area, and in the background of what a new entrance with parking would be built. We suggest that in the location in the background of Women's strand/lido an Apart hotel of capacity of 50 units would be built. Orientation to the concept of Apart hotel accommodation within the central park zone is capacity as low as possible with the greater quality of services for guests, and because of space limitations and the access and parking difficulties. This approach provides greater market power to other symbolic zone objects, and provides a stronger market position limited by high-levelled quality housing.
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B8 - Esplanade A reconstruction is proposed and new ways of presentation of focal part of 1840 Park Zone, between Women's strand and concert terrace on the lake. Superior landscape design, lighting, opening of the Esplanade to the lake by removing the present wall is assumed.
Promenade is an element connecting different experiences / zones around Lake Palic, and it will be performed in a manner that serves pedestrians and cyclists. Intelligent planning with greenery and lighting, as well as setting up the necessary infrastructure and info points to the marking of places of interest will be needed. Small tavern and Csarda remain as objects with the same purpose and with their modernization. Tennis courts would remain at the current location. The entrances to the zone would be established from the Small Tavern direction on the east and from ZOO direction on the west side. We believe that the opening of the historic entrance to the park, that is 1840 Park zone of spatial possibilities for this entrance.
We suggest that within the move from Women's strand toward the water sports centre a new small shopping arcade in the elegant wooden performances should be built. Further on, modern improvisation and kiosks must be moved from this space of crucial importance as a meeting, gathering place and magnet. On one side, inward, specialist trade shops will be posted, and on the other side, outward, toward lake on terraces, several modern and differentiated bars/cafs will be posted. Planned construction scope of this centre will be up to 900 m2 without terraces.
B10 - Promenade
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C1, C6 - SPA Water world with shops and Food and Beverage points
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considering all of the modern examples in the region. However, it is certain that its construction will follow after all other elements of the value chain of the resort appear and while personal standard of the domestic market significantly rises. This location must remain designed however just for such a highly positioned hotel, which is integral part of the site, together with Centre for aquatic adventures, family hotel and todays hotel Prezident. To the south, this zone is separated by the new park that is also proposed here in this project. The establishment of this zone imposes moving of current highway and parking lot located at the zone entrance.
This is a hotel with 4 international stars that position itself as facility for younger families with children under 7 years old. It will have common facilities for this type of hotel, and 92 family rooms and annex with 45 family suites. Strictly positioned for younger families, this hotel due to the Water centre and aquatic adventures and other resort attractions in close, will be a unique facility in Serbia and Vojvodina. Considering the entrepreneurial risk of investing, here we suggest additional annex with 45 family (family) suites, which would be sold in the market and re-hired for the commercial use of foreign investors (model sell and lease back). Customers would be eligible to use it only part of the year, and the rest of the time, the same apartments would be sold as part of the hotel. Income after deducting the business costs will be shared between owners of the apartments and investors / managers.
In the same area Wellness hotel with 4 international stars with 116 luxurious rooms is planned. The hotel is intended for active rest and relaxation, and especially health, wellness and beauty programmes. It focuses primarily towards couples over 40 years of age. It is located with views of the Lake Palic and the Youth Lake. This hotel is planned because in the final structure of the resort it must be present
On the eastern side of the Water world is proposed to construct an Entertainment park that will have the function to entertain the children in the open. The focus of the offer should be based on the offer of various elements aimed for children to play (games of obstacles, slides) with organized supervision and animators.
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D1, D2 - Palic Sport Hotel with sports hall The construction of modern Sport hotel facilities with 96 rooms planned especially for athletes, is proposed to be built with venues for seminars, fitness and medical examinations for athletes. Because of the characteristics of sports market, the extension of the hotel is proposed as Annex multifunctional sports hall. In addition to the outdoor sports centre a construction of sports hall building will provide business during the whole year.
D3 - Tennis courts In the background of Hotel Sport, the construction of the Central field with small stands, and four subsidiary courts is proposed. Reason for this proposal is to build on a long-standing tradition in tennis at Palic. In addition establishment of the international tennis tournament in Palic (Challenger), this will enhance the general image of Palic as a tourist destination.
D4 - Apartments It is proposed to build two apartment wings, each of 30 apartments of 60 and 80 m2, meant for the free market. They will represent the support to the sports complex Palic in a way that apartment owners will use facilities and services of sports complex as well as the hotel services (food). We suggest that Developing Company Palic should build these apartment buildings, so that the excess of cash can be refinanced to other elements of future Palic resort value chain.
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The conversion of Mens strand into modern outdoor thermal water Centre in conjunction with the former beach area (lido) in the spirit of Palics tradition that has been developed for the local population as free zone. This zone will create a sense of country vacation place image of Palic for local population that will have opportunities to have long-term rental cabins and changing rooms and pavilions based on Palics friend club or whatever. Rental income will maintain this parts contents.
We suggest a very strict regulation, especially considering utility connections and urbanization, and without which it will be difficult to achieve an ambitious project Palic. As a possible option to consider is the idea of reformulation of weekend housing project into some sort of tourist resort.
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build only farms and other types of low architecture typical of Vojvodinian plains, in the area of at least 10,000 m2 and more. The advantage of building in this region would be possible for local businesses that should be stimulated to build modern farms aimed for stationary stays. - On the furthest point of spatial area of the lake, on the south side, we suggest forming of a small horse/equestrian ranch, with the potential collaboration with the equestrian Centres of Kelebija and Zobnatica, as added tourist offer in Palic. - On the south side of the lake, it should be determined where to place a typical csard/ Hungarian inn, with attractive terrace on the lake. The left and right side of the terrace should place a space for sunbathing, bicycle parking and other service contents.
This rural area of the project Palic finally completes the comprehensive value chain of the project, which thus gets all the key content and activities to be promoted as a resort for all seasons.
Since we have already stated as an essential condition for the formation of a complete value chain of resort Palic, a position on the regulation necessary for the total lake area in the range of at least 500 m from the lake border , we suggest the following:
- The regulation should be established from the golf border on the west and weekend housing project border on the east side and
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ZONE
PROJECT DEVELOPMENTGOLF / WATER SPORTS OF TOURIST COMPLEX "PALIC" MICE / Final report
Golf with 18 holes Palic Golf & Conference hotel Palic Golf club Palic villas Marina Water sports centre PARK 1840 Great terrace Womens strand/lido Concert terrace on the lake Palic Lake Apart hotel Palic Park Apart hotel Palic Apart hotel Palic Small tavern Apart hotel Esplanade Shopping arcade Promenade FAMILIES / SPA / WELLNESS SPA Water world Palic Family hotel Annex Family hotel - Apart hotel Palic Wellness hotel Land of enjoyments theme amusement park Shops, food and beverage points
A A1 A2 A3 A4 A5 A6 B B1 B2 B3 B4 B5 B6 B7 B8 B9 B10 C C1 C2 C3 Palic Sport hotel Sports hall Tennis courts Apartments Lido Childrens swimming pools Thermal pools
SPORTS / LIDO
Cabins, changing rooms, pavilions WEEKEND HOUSING PROJECT / "BEIRUT" RURAL AREA CSarda restaurant / meeting, gathering place Equestrian ranch/ horse ranch farm Observing posts / platforms for fishing
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C5 C6
C4
- Economic level of local market demand, that is the level of sophistication, is not such that it provides a one-time realization of the project with restitution interesting for potential investors;
- International market demand has yet to be sensibilised to expected marketing and sales activities done by Serbia and Vojvodina and the resort, and here it takes time of at least 4 to 5 years to adapt and reach sales and business performances that provide security of investors;
- The whole project is made up of relatively complicated managing, planning -urban and investment steps of the public and the private sector, which is why it also takes time to mature. - Operating management market and the labour market in hotel and tourist industry needs also definite time for adapting. The word is therefore about a project, which can be done professionally in period of 5 to 7 years, according to priority, and activities that reflect the market and development of the necessary synergies in the function of the initial resort image growth.
Taking all this into account, the plan of key investment projects and their economic - market performances is formulated on a dynamic basis and following the priorities that step by step raise resort market position. It is not possible, namely to assume the implementation of this project phase in one investment cycle of 2 years due to the following key reasons:
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In this context, the following key assumptions are taken into account:
A. INVESTMENTS
- The focus is on hotels with 4 standard, 4 plus and 5 stars with average room size of 28 to 40 m2; - Beside the hotels , a part of the accommodation offer, is planned, associated with the real estate business, and because of risk management ,and thereby easier obtaining of the investors in terms of a limited market; - Planned value added facilities - golf course, Water centre, centre for water sports, beach, promenade, sports centre and other, whose implementation is related to high role of the public sector, that is present and potentially established strong public institutions (such as. Palic golf club, horse/equestrian Club Palic, etc.) - Planned investment in public infrastructure, according to findings of General Plan and the Urban Regulatory Plan Palic in addition to public and public / private investments in the resort planning (planning landscape, lighting, labelling, etc.). B. INCOME - Average realized price per type of capacity are planned based on benchmark analysis in the area of Central European environment of the project reduced by 15 to 20%;
- Ticket prices for the Water/Aqua centre are planned on the same principle reduced by 30%; - Occupancy is planned on the basis of benchmark analysis of Central European environment decreased by 10%; - Assessment of relations of accommodation income and other incomes is planned for each object separately on the basis of common international practice and standards within the proposed type and category of the facilities.
C. COSTS
- Respect of international hotel industry cost standards; - Respect of the cost categories share in Serbian hotel industry; - implementation of USALI methodology (unique system of Accounting for hotels); - The use of employment standards per category / room that are internationally acceptable and increased to 10% for Vojvodina occasions.
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600 m2 of modern conference centre with plenary venue for 300 visitors, 10 smaller venues for smaller meetings and seminars, sub areas and storages for furniture and equipment.
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F & B plan
BB
groups
40,0%
SE Europe
20,0%
65%
alotman
20,0%
West Europe
20,0%
120 euros
78 Euros
60 : 40
47.450 Euros
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168 320 65,0% 54,6% 120,00 75,00 39.858 1,60 63.773 4.782.960 3.188.640 7.971.600 78,00 47.450 60% 5.022.108 1.674.036 21,0% 0,65 109 2.949.492 37% 239.148 2.710.344 34,0%
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100
2,8 million
2,2 million
Income per room available (EUR) Total net income per room available (EUR)
55
80 : 20
25.100
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100
2,8 million
2,2 million
Income per room available (EUR) Total net income per room available (EUR)
55
80 : 20
25.100
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years after investment number of rooms number of beds Annual room occupancy (%) Annual bed occupancy (%) average room price (ADR u EUR) average overnight price (EUR) sold rooms Multiple occupancy factor (DOF) overnights ACCOMMODATION INCOME (EUR)
1. 112 204 50,0% 49,4% 90,00 50,00 20.440 1,80 36.792 1.839.600
2. 112 204 52,5% 51,9% 95,00 52,78 21.462 1,80 38.632 2.038.890
3. 112 204 55,0% 54,4% 100,00 55,56 22.484 1,80 40.471 2.248.400
459.900
509.723
562.100
2.299.500
2.548.613
2.810.500
Daily accommodation income per room available (RevPAR u EUR) Total income per room available (EUR) Accommodation income in total income
1.218.735
1.350.765
1.489.565
Total salaries (EUR) Salaries in total income Number of employees per room Average number of employees per working hour
1.080.765
1.197.848
1.320.935
47%
47%
47%
Fixed costs (except interest and amortization in Euros) PROFIT BEFORE AMORTIZATION, INTEREST AND TAXES (EBITDA u EUR)
68.985 1.011.780
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44,0%
High quality Wellness Hotel aimed to couples, business people and individual guests that are looking for relaxation and health. 4plus international stars Spa zone / wellness
Accommodation capacity
Category Location
Multifunctional restaurant content (market restaurant) that in different segments offers different contents of food and drinks from breakfast to thematic menus.
Other contents
Standard wellness content and beauty programmes at the area of 1.800 m2.
Location description
Hotel is located near the Panonian spa with which it has communication with guests. It is oriented towards Youth lake and lake Palic
NET DEVELOPED AREA Estimated investment (EUR) Rank priorities
9.000 m2 12 million Euros The very last priority within development of Palic resort.
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80
3,4 million
2,4 million
Income per room available (EUR) Total net income per room available (EUR)
56
70 : 30
29.200
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3. 116 232 70,0% 63,0% 80,00 44,44 29.638 1,80 53.348 2.371.040 1.016.160 3.387.200 56,00 29.200 70% 1.896.832 643.568 19,0% 0,35 41 1.490.368 44% 101.616 1.388.752 41,0%
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Family hotel for younger families with children under 7 years of old 4international stars In the north of the Pannonian spa
Accommodation capacity 92 family rooms of minimum 40m2 in the hotel + 45 family apartments cca. 60 m2 in the annex.
Typical family food and drink programme that includes children menus and pizza and pasta corner.
Other contents
Children animation centre, for the rest of the contents the Pannonia spa is in charge.
Location description
Hotel is near the Pannonian spa and it is connected on the north with hotel Prezident. Location allows separate entrance to hotel , parking lot from the central zone square.
NET DEVELOPED AREA Estimated investment (EUR) Rank priorities
10.000 m2 12 million Euros First priority, necessary capacity that is going to be built near the Water centre.
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F & B plan
groups
10,0%
SE Europe
30,0%
Occupancy Average net realised room price (EUR) Net accommodation income (EUR) Accommodation income in relation to other incomes
alotman
30,0%
West Europe
10,0%
90
3,9 million
2,7 million
Income per room available (EUR) Total net income per room available (EUR)
54
70 : 30
28.160
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137 374 60,0% 60,4% 90,00 32,73 30.003 2,75 82.508 2.700.270 1.157.259 3.857.529 54,00 28.157 70% 2.083.065 694.355 18,0% 0,32 43 1.774.463 46% 115.726 1.658.737 43,0%
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Hotel for sportsmen and sports clubs, also for younger users of active recreation and vacation in the resort. 3 + to 4 standard stars At present location
Accommodation capacity
96 rooms
Food and drinks Meeting and conference space
Restaurant, breakfast room, aperitif bar, sport lounge bar with terrace and banquets service for special occasions.
Other contents
9.000 m2 together with the sports hall 9,0 million Euros First construction priority together with sports hall, small tennis centre and reconstruction of outdoor football courts.
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75
2,6 million
1,8 million
Income per room available in Euros Total net income per room available (EUR)
52
70 : 30
27.375
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634.474
709.560
788.400
2.114.914
2.365.200
2.628.000
Daily accommodation income per room availableRevPAR u EUR) Total income per room available (EUR) Accommodation income in total income
1.142.054
1.277.208
1.419.120
Total salaries (EUR) Salaries in total income Number of employees per room Average number of employees per working hour
972.861
1.087.992
1.208.880
46%
46%
46%
63.447
70.956
78.840
PROFIT BEFORE AMORTIZATION, INTEREST AND TAXES (EBITDA u EUR) EBITDA in total income
909.413 43,0%
1.017.036 43,0%
1.130.040 43,0%
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Thematic specificum of aquatic experiences Health treatments Wellness and relaxation Fit and vital Beauty and health Salon New life style culture It is located in the eastern side of the lake near the family hotel and mens strand. It is planned for 9.500 m2 net developed area, and capacity is between 800 and 850 simultaneous users.
Location:
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Palic - PANONSKI SPA Economic and market evaluation of water centre programme
Visitors capacity: Business period: Annual number of visitors: Stabilization period: Market: domestic foreign 90% 10% At 15 min. drive At 30 min. drive At one hour drive Ticket price: Half day daily Visitors structure: Half day daily 10% 40%
Ticket income:
15,0%
Treatment income:
Average spending per guests at treatment: 748.440 Euros Average spending per guest in catering: 809.676 Euros Shops and other spending per guest:
22 Euros
~ 900 visitors simultaneously 360 days Usage: 70% Number of guests in ca catering:
42%
Catering income:
9 Euros
226.800 3 after the investment Number of guests than spending in shop 40% 40% 30% 16 Euros 15%
10%
3 Euros
70.308 Euros
TOTAL SPENDING PER GUEST (INCOME): TOTAL OPERATIONAL COSTS: Total of salaries: GROSS OPERATIONAL PROFIT (GOP): PROFIT BEFORE AMORTIZATION, INTERES AND TAXES (EBITDA): Average number of employees per working hour:
3.744.468 Euros
2.808.351 Euros
1.310.564 Euros
6 Euros 10 Euros
20% 30%
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RSD
However, according to our proposed project Palic, it is possible that the observed except roads around both lakes and relocation of the road on the east side of the lake, it should be counted on the additional sewer and water-supply capacity, which will require the construction of golf and other facilities related to golf, and other public investments associated with planning and preparation of land, parking, electricity, gas, and telecommunications network.
- Investment in the preparation of land (plan, geo, acquisition of land and buildings and demolition) Amount: 81.5 million RSD - Construction of roads (new, rehabilitation of old pavements, bicycle paths and parking) Amount: 697.3 million RSD - Construction of gas electric and telecommunication networks (lighting, cables, MBTS, etc.). Amount: 214.4 million RSD - Construction of water supply and sewerage infrastructure (Sewerage, atmospheric, water) Amount: 217.9 million RSD - Total amount according to the Regulation plan : 1211.1 million
Although it is still too early to dispose detailed calculations of investment in infrastructure, we can say without any doubt that the completely infrastructural facilities of the project will cost at least 20 to 30% more than the proposal if it wants to raise itself at the world competitive standard. It will not cost more just because of the enlargement of the procedure but also because of increased standards of equipment.
In this context here, we roughly calculate the overall investment in infrastructure for the complete rehabilitation and development of project Palic in an amount of about 20 million Euros.
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ACCOMMODATION Palic Golf & Conference hotel Palic Lake Apart hotel Palic Park Apart hotel Palic Apart hotel Palic Small tavern Apart hotel Palic Family hotel Palic Wellness hotel Palic Sport hotel ACCOMMODATION TOTAL ATTRACTIONS Golf course with 18 holes Palic golf club Great terrace Concert terrace on the lake Spa water world Land of enjoyment amusement park Equestrian ranch ATTRACTION TOTAL A A B B C C F
6,500,000 3,000,000 2,500,000 200,000 12,000,000 500,000 400,000
A B B B B C C D
48,000,000
48,000,000
5,000,000
13,000,000
30,000,000
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2,700,000 3,400,000 19,000,000 15,000,000 600,000 9,500,000
25,100,000
B A D D D D all B F
Displayed recap of key investments includes our initial proposal of the basic division of responsibilities for investment as well as their dynamics in the short, medium and long term. It is certain that this initial proposal is subject to debate, and that the final appearance of the priorities and responsibility for investment largely depends on the selected business-management model of this project.
5,100,000
3,100,000
2,000,000
2,800,000
2,300,000
A C D A F F
In this context, here recapitulated investment in Palic project regarding the quantitative scale could be taken with 90 to 95% of certainty, while the dynamics and responsibility for the investment needs to be result of public hearings related to the very concept and management model of the project.
0 22,188,000 500,000 0 11,500,000 11,188,000
22,688,000
15,000,000
15,000,000 20,800,000
0 73,588,000
0 21,500,000
Page 89 7,500,000
30,300,000
7,500,000 34,900,000
0 50,688,000
INVESTMENT TOTAL
115,888,000
14.981.708 2.400.000
TOTAL C.EMPLOYMENT
MAJOR PROJECTS SMALL PROJECTS INDIRECT PERSONELL
17.381.708
TOTAL D. INVESTMENTS(Euros)
PUBLIC PRIVATE PUBLIC/PRIVATE
810
115.888.000
29.899.297
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It is a relatively neutral category, where the representatives are the visitors of different events and meetings, resort guests, weekend people and local market of content users of recreation by the lake (womens and mens strand/lido).
Although the subjects listed are in a different responsibility position and have different qualities of interest in relation to the project Palic, there is no doubt that they are all stakeholders of the project. They have to share or be familiar with the vision, and directly or indirectly support the development of the project or simply accepted it as a fact that will radically transform the inherited situation and thus enable the region to connect with modern tourist developments in Central Europe. In this context, and considering the arguments for building reliable future business model for project management Palic, here we briefly state the objective positions of subjects of interest considering
Raising standards and commercializing the resort, local market and especially weekend visitors will have to accept the new rules and higher costs of the recreational services. In this context, it is possible to expect particular resistance towards project solutions characterized as projects that change the settled social habits. On the other hand, the market for commercial users /tourists/ visitors will necessarily react positively, considering the fact that the Serbian market has deficit of tourist resorts with quality products.
Regular information and internal marketing of this project vision and its key programs, are needed because this category of interest entities needs to be communicated with from the moment of adoption of the project.
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strong support from this group to the project. Besides the general attitude of public opinion of the population of Subotica is that Palic Lake finally has to be brought to an appropriate standard of tourist offer.
Rehabilitation and introduction of utility/communal order in the wider area of the lake will cause the greatest interest and possible resistance by the owners of property and current users of other economic assets. Imposition of utility standards and fees for use / rent will represent an additional financial cost for this interest group. Therefore, it is valuable to consider the offer to redemption to those who want to sell their real estate on prices determined in advance. On the other hand, owners of private land after the project adoption and presentation of the project to the public will have rapid increase of their parcels selling prices. The solution to this problem should be timely access to purchasing through settlement (funds) or declaring a state interest on land given over the fair value.
Considering the mission of the authorities in Serbia and Vojvodina, to encourage reasonable and long-term investment in sustainable tourism development, as well as the fact of formal and legal involvement (ownership and regulation), here is possible and necessary to expect the support and financial assistance in the development of Initial tourist and general infrastructure of the projects. In addition, when we are talking about the Republic of Serbia and its role in the field of privatization (the state Agency for Privatization) and the Tourism Development Plan (Ministry of trade, tourism and services)it is a must and necessity to come to a consensus about the projects and management and privatization model adapted to it.
Regarding that, the project is in its territory, the municipality of Subotica has most general interest for its effective implementation. Furthermore, the municipality must be an active entity in its realization through following key activities: - Commenced completion and launch of additional planning regulation of a complete project space;
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- Financing of general infrastructure in accordance with project priorities ; - Taking responsibility in the restructuring of current business mission of the Public Company Palic-Luda; - Building of incentives for future investment projects in the field of land and public policy; - Taking over of operations of the municipal utility enterprises; - Other activities according to project needs and municipalitys opportunities . Since municipality itself agreed to rehabilitation and restructuring of Spa Palic,it is expected that this project will have priority within the canopy of other development projects in the municipality of Subotica.
In the field of protection, and due to lack of financial resources, company could not permanently secured high standard of the ecology of the lake, the necessary infrastructure (mainly sewage) and architectural activities in the inner and the wider area of the lake, and thus its protection mission was brought in question. Even if the company performs works on one of their own facilities, protection function must be realised by the competent regional body for the protection of cultural monuments, and also needs construction permission for the construction of houses in the surroundings that are issued by municipal authorities. Furthermore, question of ecology of the lake considering the broader phenomenon of Pannonian lakes transformation is certainly a question of wider interest to the municipality of Subotica and Vojvodina as a whole, so it is not difficult to conclude that it is the time for a serious change of the business mission of this company according to the time to come.
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Public companies beside protection business and management of visits to the protected public assets, often perform small services (guides, transportation, exhibitions, information desks, small catering, etc.). While hotel business is typically given to be managed by professional companies.
the proposed project and if not leaded by a strong player (developer) there is a big threat to sustainable and quality development of this project. In this model, it is difficult to restrict private owners in case that its objective function is not the best one for a destination in whole.
Regarding that the Public Company Palic-Luda is at its juncture considering its long-term mission and that is already invested great part of its so called social assets in a joint private-public enterprise "Elite", it is possible that no business-management model management of the proposed project Palic looks realistic without affecting the possible position and destiny of this company.
Another option is the formation of a separate development company as joint stock company (ltd.), which would take over the property expected by project and thus took over the role of the developer of the project.
The advantage of this option is quickly separation of the public and the business functions and the possibility of a professional realization of the project at the private investors market . The lack of this option is problem to determine the ownership through balance sheet divisions as well as the fact that after the project same company has no other missions than to collect rent on leased property if the lease is the most usual model used in delivering project. An additional problem of this model is the question of ownership of the newly formed company, because if it is established as a Public Company Palic-Luda the question of efficiency of management model and jurisdiction will arise. Because of the Public Company that has so called social property (which is mostly represented as a share in the joint venture Elite), and the state property and one awarded by the municipality of Subotica, it is going to be difficult to form a new company without not resolving their general ownership situation.
In that sense, there are three key options for defining the business mission of this company in new terms:
The first option is that the same company stays public, that is state owned and to keep all public functions of protection of natural and cultural resources and to sell or rent on a long term all its business assets and functions. The advantage of this option is the speed of resolving the question of development through privatization, as well as the fact that the cash realized from the sale or long-term lease will be used for public protection and improvement of public goods. However , in the case that mentioned privatization is not done on
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Here, we come to the third model of managing that is connected to the simultaneous process of restructuring the public enterprise that is, changes in its business mission and the privatization of property as preconditions for the effectiveness of development of this project.
Therefore, it is optimal that public company Palic-Luda becomes a so-called Destination management company, holding following basic features:
In order to answer the question how to the privatization as efficient model of development of the project, it is necessary first to consider whether it is possible to transform management public Company Palic-Luda into development and destination Management Company. If the thesis is correct that today's business mission of this Company is suboptimal then professional realisation of this project can become the framework for its transformation towards following basic directions:
- All utility functions of the company, including the activity of physical purification of the lake should be taken by the competent utility companies of municipality of Subotica; - the majority of present registered business activities should be given for rent through the external services of for this specialized private companies; - All tourist businesses sites and construction locations owned by the company should be offered through long-term concessions and / or sales, and through the implementation of this project, to the market.
- Monitoring of the activities of protection of natural and cultural assets, including basic guard service; - Activities of interpretation of public and natural goods and system of organization and management of visiting mentioned goods; - possible new attractions managing activities (Aquatic centre, etc..)within the project; - Destination marketing activities, information and propaganda, in cooperation with other private acters in the area of the lake; - Capacity sales activities through private accommodation introducing special internet portal Palic; --Building destination competitiveness activities, ranging from marking, lighting, event organisations, rent of recreational sites, content and equipment, and providing guests with various destination ; - Management of public beaches, swimming pools and all facilities that will keep public function. - Other according to requirements and other development projects.
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The Company would be largely funded from its own resources, while inactivity in the protection of natural and cultural heritage will be further financed from the budget. The process of transformation will not happen overnight, but successively with the development of the project Palic and in accordance with the agreed investment priorities.
In this context, our proposal is that on the actual property structure and on the evaluation value basis (social, national and property of Subotica), company ownership determines and adequately divides between municipality of Subotica and the Republic of Serbia / AP Vojvodina. In this way, public control mechanism will be ensured for effective implementation of the project. Part of the property which may be due to the sensitivity (forests, water, etc.) not enter into capital will still be able to remain as a public good for company to manage with clear respect for legal provisions of protection.
- a formal framework for the development of the project through the role of public company as a developers with rent of external services (outsourcing) as well as expertise and easy control of delivering project will be available; - During the project development a future destination management company is being created and developed in the tradition of competing countries practice; - the public and business- private functions in the area of use and protection of resources of the lake will be normalized , with the possibility that in the final stage company itself will be organized as public private partnership.
It is our ultimate belief that in this way the consensus can only be achieved of all stakeholders and involved subjects, based on detailed developed project and to start in its professional fulfilment.
It remains, at the end, the last issue that refers to determination of initial ownership of the company that will assume responsibility for the project and that will with the privatization procedures and quasi privatisation bring the project to investors market.
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4. It is understandable that this initial proposal should come through wide discussion among subjects of interest within the Municipality of Subotica and beyond, and that it is subject to further discussion and possible changes. We expect that the final adjustment over concept and proposed practical solutions will be concluded/finished by the end of October or at least by the middle of November of 2006.
2. Based on our years of experience in planning and development of tourist resorts, we are confident that this project has a highlevelled attractiveness. Of course, if its implementation is done in a professional manner and with respect for the key rules of the game of todays global resort industry. At the same time, we are aware that the same project cannot be done overnight, but setting the right project foundation, security of spatial and regulatory requirements and the construction of human resources will guarantee its success.
5. The first step is checking of our proposal implications in relation to the solutions given by Regulatory plan of northeastern zone of Palic, and then starting planning urban regulation for the rest of the treated area. In fact, the key requirement for this project is strict and complete regulation of the surrounding space that is necessary for security of complete value chain. Through this regulation is particularly necessary to ensure the protection of the surrounding land in the function of the proposed development by this project.
3. It is necessary to bear in mind the fact that the current market situation does not allow a one-time implementation of this project in period of two to three years. As in other competitive destinations, these projects develop organically in a period of 5 to 10 years. In that sense, our market projections and proposed business performances are adapted to economic situation in Serbia and Vojvodina, especially to the examples from the surrounding Page 97
6. Within a consistent model of development of northeastern zone, the following step is entering the development of urban projects for particular sites that are indicated as a priority in our proposal. It is primarily about projects on construction/adaptation/apart/hotel accommodation in the so-called K & K Zone, as well as the beginning of planning and construction of the Water centre in the so-called SPA / wellness zone.
It is understood, also, the development of all the necessary preparatory and infrastructure works for the whole project.
7. In order to accelerate the development of investment activities it will be valuable to approach making so called investment prospects (teasers) for each particular project in order to animate potential investors who will themselves be able to offer detailed solutions in urban planning.
8. In the same way, it will be good to make a small investment prospects for projects that, by the logic of things, need to offer on the local market of investors, and as a part of a transparent and competitive bidding of investment project for the whole business community of Serbia, Vojvodina and Subotica.
realization of proposed business management model of the project, with subjects of interest of Subotica, authorities AP Vojvodina and the Serbian government consent. As already previously pointed out, any other options will extend the course of project development and negatively affect the way of its performance. Especially because none of the stakeholders is presently able to do anything important (except damage) for this project if there is no approval of its vision. It is therefore important that this project is presented to all official government representatives who are on this or any other way related to the decision making process on Palic.
9. Furthermore, this project should be, regarding its importance for the rehabilitation of Serbian tourism, and to increase of the welfare of local population, subjected to the system of incentives that are shaped at the level given by Serbian government on tourism. At a minimum, it is necessary to come up with a way of co-financing (financial support) of Water centre and other proposed attractions, which will positively affect on economic growth in the region. In addition, the so-called small and medium business that will result from this project should be linked to incentives for the a/m purpose in the territory of the Republic of Serbia.
11. Our proposal is further on about forming a development group/team within the Public Company Palic-Luda, which would be exclusively dedicated to operational development activities (planning, property issues, infrastructure, animation of investors, etc.) of the project as soon as possible in order for project to become externally visible.
12. Horwath Consulting is grateful for the expressed confidence with the emphasize of our readiness for explaining in the project in public and understanding amendments and corrections necessary at this level of developing the project.
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13. Horwath Consulting also expresses their willingness for further cooperation on the operational development of this project, which includes possible detailed investment projects, support given to Public company Palic-Luda in project management, and our involvement in the acquisition of foreign and local investors and operators in some segments of this project. Our experience in implementing such projects around the world and especially in the area of southeastern Europe and the Balkans gives us the right to believe that we can offer fruitful future cooperation on realization of this project.
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