1. NAME OF THE PROJECT CONSTRUCTION OF THE HOTEL AND SUITS BIKAVAC IN VIŠEGRAD

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1 1. NAME OF THE PROJECT CONSTRUCTION OF THE HOTEL AND SUITS BIKAVAC IN VIŠEGRAD 2. SECTOR Tourism 3. LOCATION Višegrad 4. SHORT DECRIPTION OF THE PROJECT Višegrad is a municipality in the eastern part of the Republic of Srpska, along the border with the Republic of Serbia. The area of the Municipality of Višegrad is recognizable by its picturesque hilly and mountainous landscape, the canyon of the Drina River, thermal waters and cultural and historical heritage, and the bridge of Mehmed Paša Sokolović from the 16 th century that is under the protection of UNESCO, Dobrun monastery from the 14 th century, the remains of the medieval cities and necropolis, tombstones, the Višegrad spa and Bikavac, a popular resort in Višegrad that was also mentioned in poems. The area of the Municipality of Višegrad is known for protected, endemic and relict plant and animal species, the most famous of which are Serbian Spruce and Fairy Hair (whose only habitat is around the termal waters in the Višegrad spa). Višegrad belongs to the moderate-continental climate, and the areas with higher altitude have mountainous

2 climate. For a long time Višegrad has been a major transit area for famous tourist destinations. With the Development Strategy of the Municipality of Višegrad the development of tourism and agriculture have been recognized as prioritized directions of the development. Višegrad is safe and peaceful municipality with preserved and unpolluted environment, quality drinking water, healthy food, a large number of unemployed and educated people. Višegrad, due to its diverse offers, has become an attractive tourist destination that has to be based on sustainable development grounded in the integral approach to the development of tourism. The goal of the realisation of the project Construction of the hotel and suits Bikavac in Višegrad is to enrich the touristic offer of the city and create conditions for retaining and longer stay of tourists. Bikavac is around 100 meters away from the bridge of Mehmed Paša Sokolović and 200 meters from touristic and cultural complex Andrićgrad. Realisation of the project: Construction of the high class hotel (4*) and suits includes the construction of 12 bungalows with 24 suits, the construction of the hotel with 100 beds and with a wellness centre, and sports and recreational fields. To be more precise, the surface of the plot on the area of Bikavac predicted for the construction is m 2. The existing facilities have been non-functional for more than 20 years and they are devastated. The construction of the hotel with the wellness centre is planned on the site of the facility, i.e. a former restaurant with a bowling alley. The construction of a new communal infrastructure; sewer system, water and electric energy is obligatory, because the existing one is outdated and destroyed. The construction of suits is planned on the site of the already existing destroyed suits. It is necessary to expand and pave the access road. The feasibility of the project and planned dynamics: The project shall be realized in several phases. The concept of the realization of the project is aimed toward the maximal use of the space. Phase I of the development Conceptual development - Preparation of project documentation for the construction Phase II of the development 1. The construction of the infrastructure (water, electricity, sewer system, etc.) 2. The construction of the hotel (demolition and removal of material from the facility, i.e. the site of the former restaurant, the construction of the new hotel with a wellness centre, sauna and indoor swimming pool ) 3. The construction of suits includes: cleaning the destroyed parts of the facility, removal of waste, procurement of the necessary materials and construction of the suits). Phase III of the development 1

3 The construction of the access road and parking area Phase IV of the development The construction of sports and recreational facilities Phase V of the development The procurement of equipment (wellness, furnishing the hotel and suits, furnishing the restaurant, etc.) The realisation of the project is going to last 24 months. 5. MORE DETAILED INFORMATION ON THE PROJECT WHAT TYPE OF PROJECT THIS IS? The project belongs to the brownfield investments, and land complex is in the ownership of the Municipality of Višegrad 100%. Collaboration with the investor - negotiable (public private partnership). STATUS OF THE PROJECT The project has the status of a business idea the business plan is made. REASONS FOR INVESTING IN THE PROJECT Analyses show that tourist consumers are becoming more demanding, travel more often, but for a shorter period of time and they are increasingly turning to specific forms of tourism in search for new experiences. Experts expect that annually the rate of growth of tourist traffic is going to range from 4% to 5%. Today, health, ecology and culture are being considered the main factors on which contemporary tourist flows are based. Huge natural and cultural potential of Višegrad, ecologically healthy environment, healing thermal waters are baits for tourists. The development of Višegrad as a destination should be grounded on contemporary trends in demands of tourists. The growth of shorter, more frequent and weekend trips, the growth of interest for cultural content and ecologically protected destination provide a chance for development to Višegrad. Višegrad currently disposes with 329 beds, which is insufficient when compared with the demand. With the construction of the hotel and suits Bikavac the total number of beds for the accommodation of tourists in Višegrad would increase for 172. The competition in this segment of operating and on the geographic area in which operations will be performed is not strong. Consumers are searching for improving the quality of their own life, and they take care of mental and physical health, which prompted the explosion of the wellness industry and all types of products based on the wellness philosophy. So, the demands for the wellness service is huge, the needs of customers are not properly satisfied. The users of services want quality and individualization of services. A modern guest has a huge choice and faces an incredible amount of information; beauty treatments and feeling of comfort, 2

4 development of their sense of self-confidence, maintaining health and relaxation are offered to him/her everywhere. The international Study on Spa and Wellness Users shows that 70% of hotel guests prefer using wellness services. With the quality of services, the management of the hotel and suits Bikavac is going to tend to achieve the loyalty with their clients. We segmented the market of sale to: with the quality of services and satisfying the needs, the management of the hotel is going to tend to achieve the loyalty of their clients, i.e. to have regular guests. We segmented the market: - middle-aged women who are interested in their physical appearance, working on their weight issues, cosmetics, hair, and this is mostly explained with the expansion of fashion trends, media impact, tec. These women crave and have the need to relax and use specific treatments of wellness services, so they could take their time off from their duties and look better at the same time. Besides the basic offers, other services will also be developed, like: beauty treatments, anti-cellulite treatments, pedicure, manicure, etc. - middle-aged men prefer the offer from the domain of sports or physical activities in general, and popular activities for them are also massages, sauna, etc. - the employed are prepared to pay short luxurious accommodations (where different types of massages stand out). Geographically, we segmented the market to: - local guests the potential for wellness - guests from the region, the neighbouring country Serbia tourists who visit Višegrad or neighbouring destinations, citizens of neighbouring border municipalities and others who will be drawn by hotels and their contents - foreign guests persons who as tourists visit the wider area around Višegrad and stay there longer than 2 days, foreign citizens who originated from this area, business people The competition in this segment of performing business and in geographical area in which they are going to perform their business operation in not large. In the neighbouring area, i.e. in the downtown of Višegrad (Andrićgrad) a hotel with 100 beds, that is planned for providing certain types of wellness services, in the construction. There are no other significant hotel facilities closer than those on Jahorina and in Sarajevo, which is more than 100 km of distance and on Zlatibor, that is 70 km from Višegrad. The main opponent on the national level is the Health and touristic Centre Zlatibor. The competition is welcomed, because it encourages innovativeness and helps sustain the quality of services. 3

5 The supply market In BiH it is possible to find different suppliers of the equipment of wellness, and in the neighbouring area. The equipment of the same quality can be found at lower prices than on the European market. Also, the construction services, as well as the installation of equipment, can be arranged under much favourable terms than those on the European market. Marketing The hotel and suits are going to provide more types of services: accommodation services, catering and wellness services, etc. Bikavac is close to the bridge of Mehmed Paša Sokolović, the hotel Andrićev konak and the core of the city. Bikavac is one of the vantage points in the city of Višegrad and there is also a botanical garden with 300 rare plant species and the most beautiful view on Višegrad and Andrićgrad. In the intimate space of the gazebo from the Austro-Hungarian reign, the warmest days of the year are spent. Employment and qualification structure The knowledge and skills of the staff are some of the key factors of the quality of touristic services. The staff of the newly built hotel and suits Bikavac should go to a series of trainings in order to improve the level of services. For the new wellness centre it is necessary to provide qualified and competent workforce. The highest percentage of workforce can be provided on the local labour market, but there are also a couple of occupations with the deficient number of workers, strictly associated with the realization of wellness programmes, as well as the area of gastronomy and management. Around 50 workers are required. Economic effects of the tourist consumption are achieved on three levels: 1. Direct economic effects These are all incomes that are realized through selling tourist and catering services 2. Indirect economic directs These are all material costs that are being paid to domestic suppliers 3. Induced economic effects 6. FINANCING THE PROJECT: The estimated value is BAM or EUR

6 No. INVESTMENT PLAN OF CONSTRUCTING THE HOTEL AND SUITS BIKAVAC Description Participation of the Municipality in BAM Participation of investor in BAM Total in BAM Value of the land and existing facilities Construction of the communal infrastructure Preparation of project and technical documentation Providing permits and consents, ecological study Supervision of works Demolition of the existing facility, removal of materials and construction of the hotel with a wellness centre and indoor swimming pool Construction and repair of suits include cleaning damaged parts of the facility and removal of the waste, procurement of necessary materials and construction of the suits. With the construction of the suits, two new suits of special purposes (for disabled persons) are going to be constructed Construction of the access road and parking lot Construction of the tennis court Procurement of equipment Total PLANNED SOURCES OF FINANCING total financing of the project from the investor, public-private partnership, concession All mentioned forms of collaboration with investors are acceptable. LOCAL PARTNER INPUT The construction of attraction such as Andrićgrad and tourist and museum narrow-gauge railway Višegrad-Vardište-Mokra Gora created the bait for tourists from all over the 5

7 world. It is necessary to apply the concept of integral tourist development on the development of tourism in Višegrad. Višegrad is an attractive destination for future investors where a huge potential for investing is recognized. On the tourist market Višegrad is conferring a position of a competitor that is determined by the authenticity of the area from the viewpoint of an attraction. 7. HAS THE PHYSICAL LOCATION OF THE REALIZATION OF THE PROJECT BEEN DETERMINED Višegrad is a municipality in the eastern part of the Republic of Srpska, i.e. Bosnia and Herzegovina, along the border with the Republic of Serbia. A main road that leads to Sarajevo (110 km), Trebinje (215 km), Dubrovnik (250 km), Užice (75 km), Belgrade (280 km) runs through Višegrad. The nearest airport is in Sarajevo. Railroad Belgrade Bar is situated 40 km (railway station Priboj) from Višegrad. In the neighbouring area of VIšegrad of around 110 km, there are famous tourist centres Jahorina I Sarajevo (BiH), Zlatibor, Tara and Mokra Gora (Serbia). Višegrad is connected to Mokra Gora with a museum and tourist railroad. For a long period of time Višegrad has been a big transit tourist area for famous tourist destinations. Bikavac is around 100 m away from the bridge of Mehmed Paša Sokolović, the hotel Andrićev konak, the core of the city and it is 200 m away from Andrićgrad. Planning and strategic documents: - Regulation plan Bikavac - Urban development and regulation plan of the downtown - Development strategy of the Municipality of Višegrad Ownership: The Bikavac complex is 100% owned by the Municipality of Višegrad. Infrastructure: Provided communal infrastructure 8. HAVE THE ACTIVITIES FOR THE IMPLEMENTATION OF THE PROJECT ALREADY STARTED No. 9. APPLICANT WITH CONTACT INFORMATION THE MUNICIPALITY OF VIŠEGRAD Contact: Municipality Major Slaviša Mišković Address: Kralјa Petra I No. 7, Višegrad Tel: , Fax: privvgd@teol.net 6