By Kiki Pericleous
From the fullness of hotels to the adequacy of staff and the need for continuous modernization of services, Chairman of the Cyprus Hotels Association PASYXE and Thanos Hotels & Resorts Group CEO, Thanos Michailidis provides a comprehensive picture of the dynamics of Cypriot tourism and the challenges that the industry will face in the coming years. Cyprus, despite the challenges of recent years in the international tourist landscape, continues to be one of the most popular Mediterranean destinations. The island's hospitality industry not only contributes to the economy, but has also become a benchmark for quality, service, and competitiveness.
As the tourist season comes to an end, hoteliers are facing new realities, Thanos Michailides, refers to new priorities of the tourism industry, and the strategies that can ensure sustainable growth and further enhance the country’s international stature in the tourism sector.
Cyprus consistently ranks among countries where tourism is considered not only an economic pillar but also a measure of hospitality and competitiveness. How do you evaluate the international comparative opinions on Cyprus in this field?
Cyprus remains a popular, quality, and safe destination with a high percentage of repeat visitors. However, we need to continue upgrading our tourism product to keep pace with the ever-changing market trends and stay relevant with the shifting market dynamics. The modern consumer has different needs than those of the previous decade. Therefore, we must ensure that our product remains relevant and competitive.
As this year’s tourist season comes to an end, are there opportunities for reviewing practices and applying new methods to the hotel code?
The hotel classification code has recently been successfully updated. Where special attention is needed is in the way operating licenses are issued. The process remains complex as it involves many public service departments and local authorities. The multiple licenses and tight deadlines make compliance difficult. As the Hoteliers Association, we have submitted proposals for a more productive and functional process for issuing licenses, to benefit both the public service and the private sector.
Do you see an end of an era in occupancy fluctuations or a gradual transition to year-round operations?
Both apply. Each year, more hotels extend their operations, and several now operate year-round. In the free Famagusta, for example, where traditionally most hotels closed in winter, many have extended their operating days this year to attract winter tourism and reduce seasonality. However, to achieve this, more flexible arrangements are needed so that hotels can balance low occupancy, lower prices, and continuous operation.
Have you noticed significant fluctuations in occupancy or customer demands from the beginning of summer until now?
Except for two or three cases affected by geopolitical developments, the year has overall moved at levels similar to last year. We did not have significant changes in either occupancy or customer demands. I estimate that in 2025, occupancy will range at levels similar to or slightly higher than 2024. Although arrivals have increased, this does not necessarily translate into a corresponding increase in occupancy. We must focus not only on arrivals but also on hotel profitability, which is the driving force for the necessary investments and continuous modernization of facilities. The industry, by nature, constantly demands capital to modernize its facilities. If there is healthy profitability, the investor will continue to invest in the industry. If profitability suffers, the likelihood of investment will decrease, and this will ultimately reduce the quality of the tourism industry as we know it today.
Do the staff, whether service or administrative, receive adequate training? Is there available workforce to cover market needs?
The issue of labor shortages plagues not only Cyprus but all of Europe and the developed world. In Cyprus, the process of issuing permits for workers from third countries has improved, which has helped. For better training, working conditions need improvement, and we must allow staff to remain for more consecutive seasons to gain experience and become more productive. The staff should remain in the hotel where they work for several seasons because every year you work, you improve your skills, become familiar with the hotel and the area, and become more productive. I believe progress is being made, but further improvements are needed in regulations regarding the employment of staff from third countries, so they reflect the industry's seasonality.
In which areas do you think Cyprus has excelled regarding the suitability of facilities and the overall hotel experience?
Cyprus is not the cheapest destination, nor is that our goal. We offer a high level of service, and our hotel units are particularly developed compared to other destinations. We also have the advantage of excellent weather conditions from October to April. However, our geographical location means that airfares are often higher compared to Spain, Greece, Italy, or Turkey. For this reason, we need to further enhance the tourism experience to maintain our prices, improve our competitiveness, and attract higher-spending tourists.