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TUI Magic Life (photo: TUI)

TUI to add more high-margin hotels

The tour operating group is expanding its portfolio by more than 20 new hotels in 11 countries.

Tour operator TUI has announced that it is “further expanding its position as the world’s leading leisure hotelier, strengthening the Group’s high-margin hotel segment.”

This comes as the company, like its main competitor Thomas Cook, have been struggling in their core tour operating business and expanding the more profitable hotel business.

“Hotels & Resorts, Cruises and Destination Experiences are TUI’s major growth areas. We are consistently expanding these businesses, which already account for around 70% of our Group’s earnings. The hotel segment is less cyclical than the highly competitive traditional tour operator business, now accounting for 30% of TUI’s earnings,” explained Sebastian Ebel, an executive board member at TUI.

In the next few weeks, the group is set to open more than 20 new hotels across 11 countries in Europe, Africa and Asia. The plan includes particular growth for the concept hotel brands TUI Sensimar, TUI Family Life and TUI Sensatori.

Additionally, the “all-inclusive club brand” TUI Magic Life will offer three new resorts this summer, and the company’s long-standing joint venture partners Riu and Atlantica will also expand their portfolios.

On May 1, ten new hotels opened their doors for TUI’s guests on a single day. The expansion will continue over the next few weeks. By the end of the summer season, a yacht for the adults-only brand TUI Sensimar will also complement the portfolio.

Unique approach
The acquisition of a large hotel complex on the Greek island of Kos marks the debut of a “special approach” to hotel investments by TUI, the group said.

Due to changes in the law in Greece, a public auction was held for the first time, at which TUI’s joint venture Atlantica successfully submitted the winning bid.

The three former Lakitira hotels have now officially been integrated into the tourism group’s portfolio.

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