The EUR 42 million investment was initially expected to have a payback period of 16-18 years, but after two years of operation it is now closer to 13 and Cerović believes they could reach the point even sooner. "Before coming to Ljubljana the investor did its homework," he told the STA about the Serbian group Delta Holding.
Occupancy rate went from 65% in 2018, "extraordinary for a newly opened hotel," to 75% in 2019. "We're in no way behind the competition when it comes to occupancy but our prices are almost 70% higher. This shows how large the market for five-star hotels is in Ljubljana and how much people are willing to pay for quality."
Cerović considers Intercontinental "a pioneer of luxury tourism" in the Slovenian capital which has blazed the trail by showing other investors that this business pays.
He also thinks each hotel needs to have its identity and concept and is a big advocate of hotel chains. "It's not the same if you have an unrecognised hotel or one of the world brands. A brand places Ljubljana on the world map, which attracts other investments as well as new airlines."
In the coming years Intercontinental Ljubljana wants to improve occupancy and raise prices, but in order to do that the competition must follow suit.
"We have a product that we could sell for 600 pounds in London and 500 euros in Paris, but here we cannot even set the price at 200 euros. This is also the consequence of a small and undeveloped market. I therefore urge my colleagues not to be afraid to raise prices," he said.
According to Cerović, tourists still see Ljubljana as a low-cost destination with cheap restaurants, limited entertainment options, a city dominated by three- or four-star hotels.
Ljubljana does not need to become a luxurious or boutique destination, it does however need to have clear goals. "There should not be three- or four-star hotels in the very centre of the city… There are places that are not five-star destinations, but it is clear what the hotels in the very centre are like."
He also thinks the city needs a clear vision to extend the tourism season to the whole year. Currently, the majority of guests arrive from May to October and in the off-season everyone is drawing from the same limited supply of guests, competing on price.
"Everyone thinks the only was to attract guests is with a lower price. We're not getting into that. We have quality, products and service, and this is the basis of our offer. The impact [of price competition] on the market is very detrimental."
Riding on the success of Intercontinental Ljubljana, Delta Holding is already drawing up plans to launch a four- to five-star hotel that would operate under the Holiday Inn brand. Cerović said this would be a futuristic, technological hotel that would open in 2021 or 2022.