Starwood Hotels and Resorts, operator of the Sheraton hotel chain, will open two new facilities in Iraq, 20 years after shutting down its operations there when the First Gulf War broke out.
We were there [in Iraq] 20 years ago and we had to leave, we've waited some time to find the right partners and right project to re-enter the country, Neil George, Starwood's Vice President of Acquisitions and Development in the Middle East region, told Hotelier Middle East.
The American hotel operator is choosing Kurdistan, the most stable region in Iraq, to re-enter the country.
Stamford, Connecticut-based Starwood has signed an agreement with Erbil-based property owner, BCD, Co. to open a 221-room, 39-suite Sheraton hotel, and another with Ranj Co. and Helar Co. for a 250-room Four Points by Sheraton, both of which are slated to open in 2015.
Erbil is the capital of the Kurdistan Autonomous region in northern Iraq, sharing borders with Iran to the east, Turkey to the north and Syria to the west. It is Iraq's fourth-largest city with a population of approximately 1.3 million.
Erbil is the right place in Iraq to re-enter, it's stable, safe -- there are lots of economic incentives and lots going on. It's a bit of a haven for economic development in Iraq so that's our first point then we'll grow elsewhere, George told HME.
We had to wait until we got comfortable with the security situation and until we were able to reasonably reassure our guests of a safe experience, George added. Erbil was a natural choice, it's regarded safe. It hasn't had a single incident in the last decade.
Starwood first opened two hotels in Iraq, in the cities of Basra and Baghdad, in 1982, which were closed in 1990 following Iraq's invasion of Kuwait that triggered the First Gulf War. Security concerns still remain in these areas as the Iraqi military continues to stave off insurgent groups following the completion of U.S. troop withdrawal in December 2011, marking an end to the eight-year Second Gulf War.
Now we are going back mainly into the autonomous regions, said Guido De Wilde, Senior Vice President of Starwood Hotels & Resorts in the Middle East region, Bloomberg reported. We saw the opportunities for new hotels that opened there like Rotana, which are doing extremely well. There are positive elements there: oil, gas and stability.
The hotels are expected to service corporate investors and developers, George told HME.
Iraq's holds the fifth-largest oil reserves worldwide with annual petroleum exports valued at $52.08 billion, according to OPEC figures. According to the CIA's World Factbook, Iraq's annual GDP was $108.6 billion in 2011 with a growth rate of 9.6 percent.