BASSETERRE, St. Kitts – THE decision of the Royal St. Kitts Hotel and Casino to launch its student housing service in the midst of an ongoing economic crisis, did not sit well with local apartment owners who would normally benefit from renting to university students. But, General Manager of the hotel Dimitris Cosvogiannis said it was a necessary step in a challenging time.
In a recent interview with SKNVibes, Cosvogiannis said before making hasty conclusions, local apartment owners must consider what he refers to as “the full dynamics of the economy”. He argued that, on one hand, the hotel has an obligation to continue to be innovative in order to maintain its staff and services. He said, on the other hand, the hotel operates in a “free economy with a free market” and must consider the forces of supply and demand and a spirit of healthy competition.
With the launch of the hotel’s student housing in May, a number of apartment owners claimed to have been disadvantaged by the hotels’ decision; arguing that the hotels already benefits from concessions from the government which should enable them to remain viable. However, Cosvogiannis rebutted that belief and explained that the type of concessions the hotel receives is unrelated to the hotel’s ability to rent students at a competitive price.
“The type of concession that we get has absolutely no impact on what we are doing with the student housing. I am not getting a break on Social Security payments, payroll and day-to-day operational costs. And I implore those who are quick to talk, to understand that the concessions are unrelated to the rent to students,” he asserted.
GM Cosvogiannis also argued that the hotel has a responsibility to its staff and to the island to ensure employment remains a high priority. He made it clear that only seven employees lost their jobs over the last six months and stressed that although student housing is not very profitable, it is necessary to keep the hotel’s staff employed.
“Student housing is the least profitable venture that I could ever go into! The daily rate is US$25 per day. What hotel would invest in that when the normal rate is US$120 per day? But, it helps me to maintain employment and defer and offset some of my cost. I have an obligation to do anything in my power to keep my staff employed and, if that’s going to upset the occasional investment owner in apartments, so be it!” Cosvogiannis emphasised.
According to Cosvogiannis, the hotel did not approach any apartment to recruit students but noted that in some cases university representatives requested that the hotel provide accommodation for its students. He informed that the first group of students to the programme came from Bird Rock and they often complained that they were robbed and harassed on numerous occasions.
He said the hotel’s rates are reasonable but students still have to pay a nine percent accommodation tax, which would benefit the government. He therefore argued that disgruntled apartment owners are not considering the full picture.
“Those who are vexed are short-sighted and unreasonable! This is not our usual business but it is the call to arms during this season. We are not in competition with homeowners, but I am not going to let the tidal wave of economic difficulty swallow me,” he said.
Cosvogiannis assured the apartment owners that student housing would not remain a service offered at the hotel. He called for more partnership during a challenging economic period and encouraged them to view it as an opportunity to be innovative and venture into new and profitable projects.
