A CRITICAL STUDY OF INVESTMENTS IN NEW HOTELS IN LEBANON DURING 2012-2016

Abstract

Purpose of the study: This research aims at understanding why investments in new hotels sustained in Lebanon during 2012 -2016 despite the unstable political situation that reigned over the country. Methodology: It mobilizes a survey based on a total population sample of new hotels to explain the phenomenon and identify its determinants. Main findings: Investments in new hotels in Lebanon during this crisis period are of a real estate form, encouraged by a number of factors, mainly the low cost of construction materials, the availability of a low waged Syrian manpower, the presence of investments loans and incentives from IDAL, a public agency and KAFALAT, a private one. These new hotels will operate as customized lodging facilities to cope with the growing AirBnB trend from one hand and with the increased demand from middle to high social class families of Syrian refugees. Limitations: Limitations were mainly at the methodological level. Access to data at the Lebanese Ministry of Tourism and collection of data through questionnaires were the major challenges. Implications: The analysis of the phenomenon allows a better understanding of its elements, factors and process. Therefore, concerned parties could benefit from it and take appropriate corrective measures where needed and/or adapt existing measures to changes in the hospitality industry in Lebanon. Also, researchers could connect the results to the literature related to post-crisis tourism to reveal promising research tracks. Originality/Novelty of the study: Theoretically, crises periods in a destination are not favorable for hotels investments. Yet, Lebanon witnessed during the critical period of 2012 – 2016 the construction of new hotels all over its territory. This phenomenon raises questions about the drives of these investments, their source of capitals and their process of decision making. The findings depict new insights regarding investments in new hotels during crisis period. They are basically real estate investments, virtually designed to be hotels but operate as customized lodging facilities.