Financial Modeling as Part of the Investment Project. Case of Opening a New Hotel in the Region of Russia

This paper is concerned to the calculation of the financial model of opening a new hotel Ibis 3* managed by ACCOR in the region of Russia. The relevance of the topic is that foreign investors are expanding the presence of international hotel corporations in the Russian hotel market and in the regions of Russia, so it is necessary to calculate the financial model of the opening new hotel in the region to understand if it is a profitable project and it make sense to finance such projects. Literature review was done; various authors described the structure and logic of the development of financial models. It was also analyzed the specificity of the region as places of business development and tourism. This theoretical framework was a basis for the present study. The analysis showed that the scenario when the hotel works with dynamic pricing is a profitable project for the investor, and with minimal rates the project is unattractive for the investor. The results of this study can be used by those who are planning to invest in such projects or to open hotels in regions, and also for the owners of regional hotels for the financial analysis and increasing profitability.