In the next two years, Cyprus investment projects in tourism will include nine large-scale mixed-use developments (completion date 2022), an integrated Casino Resort by the international casino giant Melco. an investment of €610 million, and a number of large projects – 9.4 per cent of building permits issued relate to major investments. Then there are two new marinas under construction at a total value of more than €2 billion.
“Investment in tourism continues strong in Cyprus, because demand does not slow, despite the pandemic. Demand was strong and increasing before the crisis, and will pick up sharply by 2023,” explained Christophe de Bruyn, CEO of THR Innovative Tourism Advisors, a consultant who worked closely with the tourism ministry in elaborating the national strategy and who is currently working with Invest Cyprus on elaborating the national strategy and action plan to turn Cyprus into a leading tourism and hospitality investment destination.
As part of that strategy, InvestCyprus has established a “Project Bank” with investment opportunities that are already under investor consideration.
National Tourism Strategy aims to attract €18.6bn investment up to to 2030, 90% private
Speaking at the InvestCyprus Fifth National Investors Summit, de Bruyn noted that the Cyprus National Tourism Strategy plans €18.6 billion in investment to 2030, of which 90 per cent comes from the private sector.
“Attention is back on the road to recovery and on the ways to build for the future. Over the last years, we have seen growing investors interest into hospitality investment in Cyprus. For example, investments in new hotels remain in the pipeline, though timetables might have changed because of the pandemic. Nonetheless, we saw the announcement of 16 new hotels in 2020 and others for 2021 onwards,” pointed out Stephanie Panayi, head of Strategic Projects at InvestCyprus.
Recovery in 2023 – or faster?
Driving this investment is a steady increase in overall tourist arrivals, with a notable increase in “premium destination targets.” de Bruyn continued.
“Total arrivals nearly doubled, reaching 3.98 million in 2019. This was 12 per cent above targets. For “premium destinations,” that is, for the high-end traveller, the number of arrivals rose from 2.66 million to 3.54 million. So we have clear evidence of strong and increasing demand,” he said.
After the sharp drop during the Covid-19 crisis, recovery is expected to take two years to reach 2019 levels. But, by 2030, arrivals are reliably forecast to grow above 2019 levels by 19 per cent, de Bruyn insists.
“We don’t know what will happen in the short term; this crisis is too unpredictable,” de Bruyn said. “But in the long term, prospects for Cyprus tourism remain positive.”
What will determine the pace of recovery? First, the level of incidence of cases in Cyprus and the main source market for Cyprus, and second, vaccination rollout in Cyprus and third, global stock markets, de Bruyn comments.
What is attracting investment ahead of the recovery? Cyprus is following in the major trends sweeping European tourism, with interest in health tourism, Wellness Centres, family bonding, sustainability, local experience, agritourism sports centres, theme parks and long-stays, according to InvestCyprus research.
These are the kinds of projects promoted by InvestCyprus, and which comprise the Project Bank, created as a key dialogue point, by InvestCyprus.
Big Brands plan investment
Noteworthy at the conference was the evidence of interest by big travel brands. Statistics shared at the conference showed that only about 3 per cent of Cyprus hotel rooms are accounted to major brands. Today, companies like the Radisson, the Hilton, the Luxury Collection Fattal and many others are considering investment projects in Cyprus.
Much of the investment in tourism will involve a shift to the independent tourist, one travelling in search of a particular experience like horse-back riding or wine-tasting, or an encounter with authentic culture. The Cyprus tourism industry will be shifting to provide for these kinds of tourists as the island emerges from the pandemic, and multiple investment opportunities are being created by this change of focus, de Bruyn concludes.