Tamar Bagdavadze, the founder of Hotel Coste, assesses the impact of the political turmoil and ongoing protests in the country on the hotel business. As she notes, in December 2024 the hotel was operating at low capacity, and the company had to switch to survival mode.
"The first half of December was complete chaos, we had negative expectations. In our case, several agreements and partnerships still worked. We cooperated with the clinic and those planned surgeries took place, so people who had urgent needs came. We are not talking about profit, we are talking about 36% occupancy. This is not a high figure. It is clear that winter is a low-load season, but we had a development plan. Business trips and New Year's corporate parties were planned in December, which had been canceled.
Bookings are not canceled in January, but there are no new ones. We have chaotic bookings, random bookings come from Booking.com," says Tamar Bagdavadze.
The founder of the Hotel Coste notes that due to the ongoing processes, it is expected that the company will not be able to pay salaries in January. As Bagdavadze says, the hotel is already unable to pay budget taxes. Amidst reduced demand, Tbilisi hotels are having to review their pricing policies. As Tamar Baghdavadze notes, Coste is no exception.
"We have lowered the prices by about 15%. It would be difficult for me to tell you that this is working very successfully. We cannot think about development, instead of reinvesting and expanding, we are always struggling with new challenges, and if the hotel business used to be interesting and profitable for investors, now everyone is trying to sell the hotel," says the founder of "Coste".
Tamar Baghdavadze also notes that there is a decrease in European vacationers in Tbilisi hotels. According to her, "Coste" has guests from neighboring and Gulf countries, while there are almost no European tourists.