The founder of Hotel “Paliani” in Mestia, Ekaterine Gvelesiani, says the business is operating in “survival mode” despite a 20% increase in tourist numbers this year. In an interview with BMGTV, Gvelesiani explained that while occupancy has grown, overall income remains stagnant due to rising costs and a shift in visitor spending habits.
“The hotel’s occupancy rate increased by 20% this year, reaching around 85–90% during the summer peak, which is very high. However, we achieved this mostly by lowering prices, so total income did not rise significantly,” Gvelesiani said. She added that the restaurant adjacent to the hotel remained closed this year because demand from higher-spending tourists had disappeared.
According to Gvelesiani, the demand for mid-to-high-end restaurant services in Svaneti has dropped sharply, while establishments catering to lower-budget travelers managed to continue operating. “Guests from Asia usually have a budget of around USD 10 per day for food, which is too low to sustain higher-class restaurants,” she explained. “Meanwhile, product prices, utility bills, and staff salaries all rise every year, making it impossible to survive when businesses must also cut prices.”
The hotel founder said Paliani has managed to stay afloat only by drastically reducing expenses, including closing its restaurant. Despite the challenges, Gvelesiani noted one positive trend, the share of local Georgian tourists increased by about 30% this year, while visitors from China, India, Israel, Turkey, and Pakistan made up most of the foreign guests. “We are glad that more locals are visiting Mestia, but this year we had almost no tourists from Europe, the markets we used to rely on,” she concluded.
