A small town, its hotels and their creators, part I: the unity of different

Close-up of colorful spices in rustic containers on a wooden table.

Among the numerous Russian cities with a population of up to 100,000 people, no two are the same. But many people really have one aspiration: to join the growing flow of domestic tourism. But for this, among other things, modern hotels are needed. Who will build them?

Небольшой город, его гостиницы и их создатели, часть I: единство разных

In the near future, the first five-star country hotel in the region will open in the village of Tulinovka in the Tambov region. It will be located in an ancient manor house of the XVIII century, which in 2021 the restaurant and hotel holding WeFamilyGroup bought from the previous owner, who was extremely carefree about the historical building (by that time the estate was already planned for demolition, in order to then divide the adjacent territory into suburban areas). Restoration work has been underway in Tulinovka for two years now, the total investment will amount to more than 350 million rubles, and the first guests will appear in the new hotel, probably in two years.

Небольшой город, его гостиницы и их создатели, часть I: единство разных

Небольшой город, его гостиницы и их создатели, часть I: единство разных

Небольшой город, его гостиницы и их создатели, часть I: единство разных

This could be the beginning of an article on the importance of preserving historical heritage and its involvement in modern commercial circulation. Or about the prospects of the segment of country hotels, on which the current lifestyle world makes a special bet. But today we will talk about something else: how is the hotel segment developing in cities with a population of up to 100 thousand people, why, in the presence of almost win-win hotel and tourist locations, entrepreneurs are looking for less obvious points of attraction on the map of the country and whether there is at least some economic sense in investing in small hotel facilities that still need to be made popular, often together with the city itself.

Can we say that now, when the phrase “development of domestic tourism” sounds from everyone … well, literally from everywhere — so, can we say that the hotel business has begun to actively look at small towns? Cities with a population of up to 100 thousand people are heterogeneous, and it is impossible to say that they are all equally interesting to tourists, Marina Smirnova, partner, head of the Department of Tourism and Hospitality at CMWP, begins the conversation. These may be suburbs of Moscow (Vidnoye, Chekhov, Zheleznodorozhny, Dolgoprudny, Lobnya) or resort towns (Anapa, Gelendzhik, Yalta, Mineralnye Vody, Azov, Yeysk, Sheregesh/Tashtagol), where the attractiveness of hotels is a priori high. Here, the demand for hotels is determined not by the number of residents, but by the scale of the tourist flow: for example, Anapa, with a population of 59 thousand people, receives 4-5 million tourists a year.

The list includes historical cities (Vyborg, Kineshma, Sergiev Posad, Pavlovsky Posad), and here, too, developers and hoteliers focus on the size not so much of the city itself as the tourist flow. For example, in Vyborg, where about 1.3 million people visited in 2023, there are already more than 500 apartments rented to tourists daily, and among the hotels there is even a modern four-star Victoria Hotel with 61 rooms.

A significant share in the list of small towns is made up of industrial centers and/or single-industry towns (Mezhdurechensk, Yelabuga, Noyabrsk, Salekhard, Gubkin, Zheleznogorsk). There are capital cities (Gorno-Altaysk, Magadan), in short, the spread is huge, the expert notes.

Marina Smirnova, Partner, Head of the Department of Tourism and Hospitality at CMWP, “There is, for example, Mezhdurechensk — this is a mining town, the Raspadskaya mine in its radius. There are three “good” hotels in the city with a total of 36 rooms. There is no great activity in construction in the city itself, but recreation centers / country hotels around it are actively developing. After all, Mezhdurechensk is the “capital of the taiga”, a city that is part of the same tour cluster with Sheregesh. Kineshma is another example: a city on the Volga River, known as the point of the cruise route. By the way, he served as the prototype of the Volga city in Ostrovsky’s drama “The Storm”. Investors with large projects have not yet reached here. Despite its rich history, it is a “transit” city, and tourists do not stay here overnight. And those who still stay can find interesting offers at the hotel on the water “Mirnaya Marina” or in apartments rented to tourists. There are five to six hotels and guest houses operating throughout the city, and there are no hotels with more than 50 rooms.”

“Everything depends on the city, its history and geography. If a city with a history, like the cities of the Golden Ring, or with good natural data, like, for example, small towns in the Kaliningrad region, then, of course, they arouse interest first from tourists, and then, as a result, from hoteliers. A lot more depends on the regional authorities, who can and should be responsible for the events and infrastructure, because along with history and nature, these are also important drivers of tourism development,” continues Alexander Gendelsman, managing partner of ZONT Hotel Group.

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Alexander Polenkov, Head of Business and Investment at the Monchegorsk Development Agency, agrees: the need for new hotels in small towns arises primarily due to the growth of tourist traffic. “New destinations are opening up for travel within the country, interesting event projects are emerging in small towns, all this increases domestic tourism, and, accordingly, the available opportunities and capacities of the hotel fund can no longer cope with the resulting flow of people wishing to stay in this city. The flow of business travelers is also increasing, and local residents also often use hotels and hotels, so we are faced with the fact that the number of people who want to rent rooms exceeds the available possibilities,” the expert shares his observations.

“I would not say that the interest of hoteliers in small towns is growing. Rather, the interest of travelers is growing, who increasingly have a request to “see the real Russia”, but most of them have already visited many small towns abroad and know how it can be. They are no longer ready to put up with tasteless food, uncomfortable mattresses and a complete lack of service. In view of this, any project opened in a small city, but really at a good level, quickly gets a high load and demand. It may seem like a great business strategy to open hotels in small towns in Russia. But no, a small town differs from a small town, and often dramatically,” adds Andrey Shemyakin, managing partner of SEA Company.

Among large domestic structures involved in the development of hotels and hotel apartments, the idea of building in small cities is not very common, to put it mildly: for a new project, they will rather consider both capitals, Sochi, which continues to swell, or some other hyped market capable of digesting an object with a room stock of 250+. But, as follows from the words of Vadim Trukshin, CEO of the Mantera Group, there are happy exceptions.

Vadim Trukshin, CEO of Mantera Group, Mantera Group, as a strategic investor in the tourism infrastructure of Russia, initially invests in large facilities in already promoted tourist territories. At the time of making a decision on investments, we assess several key factors: the tourist flow, the socio-economic potential of the territory, transport accessibility and prospects for logistics development, the general attractiveness of the region for travel, and also take into account the amount of state and regional support for infrastructure projects. Of course, the proximity of the facility to cities with millions of people or to tourist centers creates opportunities to implement the project more efficiently, ensure its high profitability and quick payback. But today, the attention of such major market players as our holding is attracted not only by the promoted destinations, taking into account the large-scale state support for the tourism industry. We are interested in creating unique, inimitable locations. And in our investment portfolio there is a case of creating a tourist facility not even in a small town, but in an already abolished settlement. We are talking about the “Amazing village of Mandrogi” — a completely recreated tourist site on the site of the ordinary village of Verkhniye Mandrogi in the Leningrad region, which historically existed on the banks of the Svir River, but was destroyed during the Second World War. Now there is a hotel complex in this place, which includes eight huts recreating the atmosphere of merchant houses, two huts of the XIX century, specially brought from other lost villages, a three-star hotel, baths, museums and six huts with craft workshops, which host various master classes for adults and children. There is also a rental stable, the church of the Prophet Elisha, sports areas and a helipad, a ferry crossing and a river station with berths for motor ships and yachts. Mandrogi is a unique point of immersion into the life of the XIX century on the map of tourist routes of the Leningrad region, during navigation it is visited by up to a thousand guests a day. The object is included in the Silver Necklace of Russia project in the wooden architecture section, films and TV series are shot here. And the project has also created new jobs: about 300 people come to Mandrogi to work every day.”

And yet the main driving force is local entrepreneurs, natives of these very small towns, striving to do something important, beautiful and useful for their (or not for their own, but for someone else’s) small homeland, says Marina Starchikova, co—owner of the restaurant and hotel holding WeFamilyGroup.

Marina Starchikova, co-owner of the restaurant and hotel holding company WeFamilyGroup, “Probably everything depends on the environment. There are quite a lot of such entrepreneurs from my environment, because you yourself are from a small and medium-sized city. And then I’m looking for a community of the same people. For example, the “Small House” is an independent space, and there, inside this club, there is a community of those who are engaged in the sustainable development of territories and just small towns. Ples, Suzdal, and the cities of the Saratov region are represented there, in general, there are many different ones. I see that these entrepreneurs, who have already been successful in other businesses, are returning to their small homeland and trying to restore not only architectural monuments, but generally give the territory a second life. An interesting story was about a city, in my opinion, in the Saratov region, where a ski resort was built (I don’t remember what it’s called). The businessman used his money to first buy one abandoned house and restore it, then another — now the museum is being restored there. Attracts his friends and acquaintances, they also come, buy side by side, and so a whole beautiful street has already appeared. And if, for example, five years ago we did not even hear about anything like this, now the topic has just “appeared”. She’s really a newborn, she’s still so small, but she’s moving forward, and I think she’s going to gain momentum every year.”

Marina Starchikova knows what she’s talking about. The hotel portfolio of WeFamilyGroup includes the already mentioned historical estate in Tulinovka, and the Ples Hotel in Tambov, beautifully rebuilt from an old Soviet building, and the Gerasimov Hotel in Michurinsk, built from scratch, ideally fitting into a small space between the museum—estate of the artist Alexander Gerasimov and the Cathedral of the Bogolyubsky Icon of the Mother of God.

Небольшой город, его гостиницы и их создатели, часть I: единство разных

Gerasimov Hotel in Michurinsk. Photo: Valeria Mozganova/BFM.ru

By the way, three years ago, in an interview with Business FM, the current director of the Pushkin Museum, and then the head of the Shchusev Museum, Elizaveta Likhacheva, called this phenomenon the maturity of capital. “It is clear that any capital strives to increase profits, but gradually — usually by the third generation of the bourgeoisie — a national orientation of capital appears. This was actively observed, for example, in the XIX century. Now the processes have accelerated as much as possible, and you and I see 30 years after the beginning of a new era of Russian capitalism that capital is turning its face to its country and is ready to invest in it,” Elizaveta Likhacheva noted at the time.

All WeFamilyGroup hotels are small in scale. Everyone is dearly loved. Everything is economically verified. Marina Starchikova and her colleagues in the workshop have thought a lot about how to combine love and economics, how to solve numerous problems — from a shortage of land to a chronic disease of seasonality, how to make a small hotel in a small city not only a profitable business, but also a point of urban attraction, and now they are ready to share the results of their reflections.


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