Hotels responding to rising demand for conference rooms
In response to the booming market for conference room rentals, Warsaw's largest hotels are busy upgrading and expanding their facilities.
Only a few years ago, a few major hotels in the capital did not have conference room space available for corporate or individual customers. Now they all do. (See the List, pages 14-15.)
"Each hotel realizes that (conference room rental) is a good, profitable business," said Leszek Szczepanski, the assistant to the director of banquets and catering at Warsaw's Forum Hotel. He said renting conference room space is convenient for companies that don't have enough room in their own offices or want on-site catering. Szczepanski noted a significant increase in conference room rentals during the past two years. He refused to say, however, how profitable such rentals are for the hotel.
In an effort to keep up with requests, the Forum, which is ranked No. 1 in terms of hotel rooms available, is planning to increase its total conference room area from 650 square meters to as much as 1,300 square meters before the next tourist season. The Sheraton Warsaw Hotel & Towers, the fourth-largest hotel in the capital, has just purchased a 1,200 square-meter marquee that will accommodate up to 1,000 people, said Warrick Gunning, the director of sales and marketing for the hotel. This space will add to the Sheraton's 1,700 square meters of conference room area. The Hotel Sobieski, which has 639 square meters of conference space, is also aware of the growing need but can't enlarge its conference areas due to space limitations, according to Iwona Switek, head of conferences and banquets at the hotel. The Sobieski accommodates conference customers by renting out space in nearby office buildings, she said.
"There's still a lot to do (in terms of meeting the demand for conference room space in Warsaw), primarily in the area of large conference rooms (1,000 square meters-3,000 square meters), Switek said.
Millennium Plaza, a new conference center on Aleje Jerozolimskie whose planned construction is expected to start soon, may help fulfill some of the demand for larger space. The 130,000 square-meter plaza will contain a congress center, an exhibition center with a maximum area of 20,000 square meters, two hotels, a multiplex, a trade center and parking space, all at an estimated value of $200 million. But the Forum's Szczepanski isn't daunted by the possibility of increased competition. "A hotel located where we are, which offers catering, beds and a conference room such 'all-in-ones' will certainly do well," he said.
While corporate customers typically rent rooms during the week for in-company conferences, trainings, interviews and press conferences, individuals tend to rent on the weekends, hotel representatives said.
High school students, for example, book hotel conference rooms each spring to celebrate their pending graduations. Wedding receptions and christening parties are also common weekend events, hotels said.
At any rate, daily demand for conference rooms is immense, said Teresa Baranowska, head of the marketing department at PUHiT, which owns the two-star Felix hotel in Warsaw. She said that on average the hotel's conference rooms are 90% booked throughout the year.
At the Forum, Szczepanski said that the hotel's conference rooms are more than 90% occupied on weekdays in the spring and fall. That figure plunges to 60% in the off months, he said.
The Sheraton also boasts a 90% occupancy rate during the week, Gunning said, adding that the yearly average is 65%.
But having conferences rooms filled with businesspeople and party guests isn't the only benefit for hotel operators. Catering to their food and drink needs is another.
Every conference has at least one coffee break, Baranowska said. In addition, hotels profit from sessions that stretch over several days and involve participants from all over the country by providing lodging and food to attendees over the course of the conference, she said.
The cost of booking a conference room depends on the quality and size of the space. To rent a room for an entire day at the Felix, the price can range from zl. 400 to zl. 1,300. The Forum charges zl. 1,700 a day for a space that can accommodate up to 100 people. The Sobieski's largest conference room goes for $1,024 a day. The Sheraton charges anywhere from $300 to $3,000.
The quality of facilities is also important to customers. "The conference rooms differ primarily in design," said Szczepanski, adding that rooms in hotels of a similar standard vary little in terms of quality. Switek also said there's a correlation between a hotel's number of stars and the quality of its hotel rooms and conference facilities. The Sheraton, which Gunner claims has the "best" facilities in the country, is planning to open a high-tech conference room late this year. The room will, for example, allow attendees to connect to the internet via modem.
