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Taking a new look at the regional hotel market

CB Richard Ellis has its eye on Poland, the Balkans

By Curtis M. Wong
Staff Writer, The Prague Post
July 18th, 2007 issue

Jan Přerovský/THE PRAGUE POST
CB Richard Ellis hotel chief Daniel Koetser has big plans for the East European market.
CB Richard Ellis s.r.o.

Praha City Center
Klimentská 46
Prague 1
Tel.: 224 814 060
Web:
www.cbre.cz

Although it’s been established in the Czech Republic for less than a decade, CB Richard Ellis is an internationally recognized player in the commercial real estate market. Located at Praha City Center near náměstí Republiky, the company specializes in the sale, acquisition, leasing and valuation of offices, retail units, shopping centers, industrial parks and hotels around Europe.
Sometimes, however, even the most prestigious company can benefit from a fresh perspective. Enter Daniel Koetser, a Parisian transplant who moved to Prague to lead CB Richard Ellis’ hotel team for Central and Eastern Europe.
Originally from Switzerland, Koetser attended university in Boston and spent several years in New York City, where he analyzed event business plans at CNB Entertainment, followed by a stint carrying out feasibility studies in commercial real estate. With the Manhattan experience under his belt, he returned to Europe, where he earned an MBA at the Glion Hotel School in Switzerland. Prior to joining the hotel unit at CB Richard Ellis, Koetser served as the director of investments at Atisreal BNP Immobiler in Paris.
By helming the company’s regional hotel services, Koetser is able to combine his sharp business acumen with his love of the hospitality industry. In doing so, he says he hopes to bring a Parisian-style level of sophistication to Prague and the rest of the rapid developing Central and East European markets.
Recently, Koetser sat down with The Prague Post and offered his thoughts on the emerging hotel development markets in this part of the world, hinting at the company’s direction for the future and how Poland and the Balkans are quickly positioning themselves as leaders in the industry.
The Prague Post: Why do you think CB Richard Ellis is considered a leader in the Central European hotel development industry?
Daniel Koetser: Essentially, we were the first ones here. We’re the first global hotel consultancy firm in the region, and we’re recognized for it. We want to make sure we have the same quality services across all of our offices. We have history and knowledge in the industry, and I think we are able to put our resources behind it in a way that no other company can.
TPP: What sets your firm apart from competitors and rivals in the hotel field?
DK: I think we’re mostly set apart by our size and capacity. In hotels, we have a very good team, with the diverse abilities able to handle the most complex of scenarios, whether portfolios, such as Accor Sale and Leasebacks; single asset disposals and advisory, such as the Colton Bratislava and Hilton Prague or IPO investment consulting, such as Warimpex. Our team members have a love and a passion for this business. When you’re involved in this line of work, that’s essential. Basically, we have the expertise to understand what our clients need. Whether it’s in London, Paris, Central or Eastern Europe, our clients know that we have the capacity. There are companies that offer similar services, but I think that CB Richard Ellis is able to surpass them based on the knowledge and the dynamics of our business lines.
TPP: How does the hospitality industry in Prague and Central Europe compare to the industry in Paris and the rest of Western Europe?
DK: Both on the trading and operational side, I would say that it’s currently not as sophisticated as the West European markets. Whether it’s a question of quality of service or the product itself, it’s not as developed. As a consequence, the transactions are often not as complex. However, it’s rapidly developing in an exponential way. Over the past 10 years, the risks have been significant but upside considerable. Now it’s become more reliable, and the opportunists requiring more than 20 percent returns are moving further east, or in the lower category investment class such as budget hotels.
TPP: How do you think the Central European hotel market will change in the next decade, and how will your firm address these changes?
DK: The assumption that we can all make is that they will gradually approach the West European levels of business and the West European qualities. It’s a fairly large region, and we want to make sure we’re represented across it. Certain regional markets, such as areas in Poland, are going to develop faster in the medium term. In some cases, the smaller regional cities are becoming as significant in terms of investment attention as the capital cities. We make sure we’re in touch with those developments and make sure we know how those developments are behaving. We need to be at the forefront of every market to ensure that we advise correctly, and we’re doing that very aggressively. We want to offer the same quality services we deliver in Western Europe to the regions in Central and Eastern Europe.
TPP: What’s the most enjoyable element of your job?
DK: That’s a tough question. I’m in this business because I love it. It’s a very challenging environment, to be at the helm of a real estate firm. But I enjoy that challenge. It’s a fantastic company, and I get to deal with capable, dynamic individuals. The people I work with are diligent and knowledgeable, and it’s a pleasure to have those around in a business environment. Our hotel group is a large family and has a very supportive structure across the board. I’m in a great position to unite a fantastic team, and I have extraordinarily good resources and relations with a diverse audience of investors, developers and operators. We’re well positioned to bring significant value to a transaction or advisory role.
TPP: Conversely, what’s the most challenging element in your job?
DK: I think there’s a lot of the unknown. It’s hard to ensure your liabilities, so we take that task very seriously. An additional amount of effort must be undertaken when you’re in a position where you represent clients. We have to ensure that our advice is very well researched. We have to ensure that each transaction is very sound. But I believe in my team and in the people we have.
TPP: What are your personal and professional plans for the future of CB Richard Ellis in 2007–08?
DK: There are certain markets we’ll be focusing on, and to be seen as a pioneer in these markets is very important. We’d like to focus on the Polish market, the former Yugoslav states and Romanian markets, while not excluding our attention toward the smaller growth capitals. We’re already very active in these markets, but I’d really like us to be recognized as No. 1 across the region. I would like to make sure that I develop the office in a way that addresses the needs of the market. It’s important to contribute to the evolution of the market. It’s a hugely varied platform market, and we’d like to make sure that we’re driving the business. I think we have the capacity and resources to do that. Personally, my background, education and network provide me with access to a large market, and I’d like to bring further foreign interest to the market as a consequence.
TPP: What advice would you give to someone who’s interested in entering the Central European hotel market either as an investor or developer?
DK: I’d say that the most important thing is to make sure you’re educated. Seek advice from specialists and make sure you know the product and the market. It’s very exciting to invest in Central and Eastern Europe, but the market is changing rapidly. You have to know what your objectives and strategies are, and you need to know that your plans are applicable.

Curtis M. Wong can be reached at specialsection@praguepost.com


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