May 25, 2016
Bulgari to build hotel in Russia with Magnit minority shareholder
May 25, 2016
Italian jeweller Bulgari has teamed up with Russian real estate investor Alexei Bogachev to build its first hotel in the country, it said on Wednesday, a day after opening its second Russian store.
Bogachev, who also invests in agriculture and owns around 4 percent of shares in Russia's top retailer Magnit (MGNT.MM), said he would invest around $200 million in the Moscow hotel which will be operated by Marriott International Inc.
The hotel on Moscow's central Bolshaya Nikitskaya street will feature 65 rooms, 14 residential apartments, and a 1,600-square metre spa area, Bulgari Chief Executive Jean-Christophe Babin and Bogachev told a news conference.
It will open in 2019 to become the seventh hotel under the Bulgari brand. Besides the existing hotels in Milan, London, and Bali, three further establishments are due to open in Shanghai, Beijing, and Dubai in 2017.
Bulgari, the flagship jewellery brand of luxury group LVMH (LVMH.PA), also has another four hotel projects, likely to be unveiled in the next few months, Babin said.
"In the next decade, probably, we will open five more, the target being to be only in the most trend-setting cities or, like in Bali, in the most trend-setting resort locations in the world. And eventually we will probably have between 15 to 20."
On Tuesday, Babin told Reuters that Bulgari planned to add up to four more stores in Russia over the next ten years after opening the company's second store in Moscow.
"Not all brands agree that it's crisis time, not all brands are resigned (to the fact) that times will be tough, we are ready to fight," Babin said on Wednesday.
"We are extremely confident in the future of Bulgari in Russia and in the future of luxury in Russia," he added.
The global luxury sector has been knocked by a sales slowdown in parts of Asia, while stores in European capitals and airports have been deserted by many tourists after last year's attacks in Paris.
In Russia, consumer spending was hit by currency weakness after a drop in global oil prices and Western sanctions over Moscow's role in the Ukraine conflict.
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