Executive Summary - Deloitte Report
The aim of the project was to carry out market research and concept validation of the Algarve Race Resort, located in MexilhoeiraGrande (Portimão), promoted by Parkalgar. Therefore, the principal objectives were to:
- Know the quality hotel sector in the Portimão region, as regards the supply of hotel services, supply of complementary services, demand, pricing, principal players and principal tendencies;
- Know the potential for a quality hotel unit integrated with a car racetrack and complementary supporting infrastructure (Technological park, kart racetrack, etc…);
- Validate the projected hotel concept;
- Identify the principal interconnection drivers between the hotel unit and the other business areas included in the Algarve MotorPark.
The Algarve, the Portuguese region with the highest share in terms of overnights spent, has to date often been considered only as a sun and sea destination. Currently, with the objective of minimising the seasonal effect, a problem that affects all summer/vacation destinations, the Algarve is trying to structure its tourist offer in order to reach new segments.
The Algarve is improving and complementing its tourist offer, mainly with three products: Sun & Sea, golf (with new and very challenging golf courses) and orientation to the MICE segment. Despite it already being considered a “golf destination”, it is not yet recognized as a “destination for the MICE segment”. The public tourism entities, the hotels and all the other private players in the tourism sector are conscious of the importance of the MICE segment to their activity. In the past three years, there has been a visible effort to increase the Algarve’s attractiveness to business tourism: it was created an association -Algarve Convention Bureau -, which is responsible for the coordination, stimulation and promotion of the MICE segment in the Algarve; the hotels are adapting and improving their offer with new, more spacious, top technology conference rooms; the new congress centre in the Arade region (“Pavilhãodo Arade”) will open at the end of this year, contributing to the attraction of more and bigger events.
The strengths of the Algarve region for the MICE segment relate mainly to the sunny climate, variety of golf courses, quality of the hotels, price-quality relationship in the low and medium seasons and the flexibility and sympathy of the people. The problems faced by this region are the lack of venues –different/special spaces to organize meals, parties or other activities, other than hotels (company and event organizers value places that are of cultural or architectural interest) -, the lack of complementary and innovating activities, and accessibility –direct airline connections to some countries (these aspects have more impact on events where the participants come from different countries around the world).
Twelve hotels were included in this review, of which eleven play an important role in the organization of events. These hotels are located in three major regions:
- Albufeiraand Vilamoura;
- Portimão, Alvor, Porches;
- Almancil.
Despite the present supply, there is a need for new and more suitable spaces, in order to consolidate Algarve as a MICE destination and avoid being a second choice in favour of other destinations. As it grows, the MICE market becomes more demanding, wanting more innovation, a good quality-price relationship, high quality hotels and supporting infrastructure, better accessibility, good technical conditions and tailor-made events.
Therefore, a complex like Algarve Motor Park will introduce a new concept for the Algarve and more specifically Portimãoas there is a lack of venues, mentioned by the major players in this segment, and high capacity infrastructures to receive events. This complex is specifically designed to fulfill market needs, comprising a unique race track with superior quality hotel establishments, high technology equipment and a series of complementary infrastructures such as kart track, football field, tennis courts, golf courses nearby, among others.
Additionally, based on (1) the information collected about the number of venues and evolution of supply and demand for MICE in Algarve hotels, (2) the information collected about the number of car/automotive related events such as new model presentations, tests and racing events that take place in Portugal and international destinations, (3) the number of workers based on the technological park, and (4) the other identified segments, it can be concluded that there is significant potential for the lodging part of the complex, composed of a hotel and an apart-hotel.
