MOSCOW – Ritz-Carlton, a unit of Marriott International Inc. (MAR), expects to open its first hotel in ex-Soviet Kazakhstan within three years, the company's top executive told Reuters on Friday.
The company is also looking for a site for a hotel in Russia's second city of St Petersburg, Ritz-Carlton president Simon Cooper said in Moscow, where he was attending the opening of the brand's first hotel in Russia.
Kazakhstan, home to massive oil and gas reserves, is seen by investors as the strongest former Soviet economy outside Russia and is forecasting 2007 economic growth of 9.7 percent.
Cooper said his company was looking at two potential sites in Almaty, Kazakhstan's commercial capital.
"This is going to happen, would be my guess," Cooper said in an interview in the newly completed Ritz-Carlton Moscow, which overlooks Red Square and the Kremlin.
"I would say that you could check into a Ritz-Carlton in Almaty probably within three years."
He said his company was looking for a site for a hotel in the centre of St Petersburg, but had not yet found anything suitable.
"I have made a couple of visits there, and that's definitely a place we should be," he said.
"I don't have a site. We have looked at a couple of things, we rejected them. We just haven't hit the right spot yet."
On other global expansion plans, Cooper said China was the most important market for the company, but it had no immediate plans to add to the two hotels it already operates there and the six under construction.
"I'm not saying it won't happen .... (but) at the moment we are happy with what we've got," said Cooper, who is also the company's chief operating officer.
He said Ritz-Carlton would announce plans for a new hotel in Europe in a few weeks, but did not say where. On the U.S. market, Cooper said the company expected only modest expansion because it was already well represented there.
"If there is a market where we are approaching it (saturation), it has got to be the U.S.," he said.
But construction costs in the United States, a major bar to expansion in the hotel industry, had flattened out this year as the U.S. housing market cooled and energy costs stayed under control, Cooper said.
The $350 million Ritz-Carlton Moscow, where rooms will start at just under $1,000 a night, is a vote of confidence in a Russian economy that less than a decade ago was hit by defaults and a market crash.
The company said initially it expects the majority of guests to be business travellers and tourists from outside Russia.
"All economies that are developing at a relatively rapid pace, and Russia would be one of them, you have got to have bumps in the road," said Cooper.
"But fundamentally when you look at Russia you've got to believe that the natural resources that Russia has, if harvested effectively -- and they seem to be harvesting them very effectively -- are going to bode well for the future."