Aparthotels: new growth spot for non-residential construction in Russia

Posted on by efalucskai

Written by Andrey Vakulenko – MACON, EECFA Russia

Russia’s resort real estate market has seen a dynamic growth in recent years, partly due to the emergence of aparthotels – a format attractive to both developers and hotel operators. The coming years are also expected to see a sharp increase in aparthotel construction, supporting the non-residential construction market – according to Andrey Vakulenko, EECFA’s Russian analyst.

Thriving aparthotel segment

Resort real estate has been one of the fastest-growing segments of the Russian construction market in recent years. Aparthotels – apartment complexes with minimal infrastructure and services, and with the mandatory availability of a trust management – have particularly seen a rapid growth, though they are relatively new to the Russian market. The core of the supply is (and will be) resort projects, i.e. aparthotels in locations with developed recreational and tourist infrastructure for seasonal vacations. Urban aparthotels – primarily in metropolitan areas with minimal infrastructure – are rather aimed at business travelers and to a lesser extent at traditional tourism and long-term rentals.

As of Q3 2025, the aparthotel market size stood at 25,200 units with a total area of ​​612,500 sqm and by the end of this year, roughly 143,000 sqm of new aparthotels, or 4,300 new units are expected to open. Based on the announced plans, the next three to four years will register a sharp rise, and by the end of 2029 aparthotels may amount to around 109,800 units with over 3.6 million sqm, almost six times higher than the current level.

Behind the growth

One of the main reasons for the anticipated expansion of the aparthotel format is that domestic tourism gained popularity after 2022 due to the reduced accessibility of many international resorts (because of the suspension of air travel, the weak ruble, visa issues, and other internal or external restrictions). Rise in domestic tourism created stable high demand for accommodation in virtually all key resorts in Russia.

Another reason is that developers specialized in multi-unit residential construction began to start many projects in aparthotel and resort real estate construction amid the decline in the residential real estate market following the cancellation of the mass preferential mortgage program.

Also, there are significant incentives and state support for developing tourism infrastructure and the domestic tourism industry, including the construction of hotel complexes and aparthotels.

Furthermore, in 2024 the status of aparthotels was legalized; they were included in the official hotel classification system, creating uniform standards for the segment and transparent conditions for market participants.

Besides, the departure of many large foreign hotel operators from the market in 2022 led to the expansion of Russian hotel chains (Azimut Hotels, Cosmos Hotel Group, Alean Collection, ZONT Hotel Group, VALO Hotel Services, Mantera Group, among others), which began collaborating with aparthotels, increasing the latter’s attractiveness and guaranteeing a high level of service and trust management services.

Moreover, many investors appeared in the market who found the trust management model used in aparthotels and the opportunity of generating passive income attractive. The operating return on investments in aparthotels in developed resorts managed by well-known hotel brands can reach 7%-10% and higher. And given the rise in the market value of apartments, long-term returns can reach 13%-17% per annum, exceeding the return on long-term bank deposits (currently 8%-10% per year for a three-year deposit).

All this suggests that aparthotels will be a major segment of non-residential construction in the coming years.

Coastal regions: top locations for aparthotels

The aparthotel format is developing most actively on the Black Sea coast, currently accounting for over half of the total supply in this segment. Urban aparthotels are primarily in Moscow and St. Petersburg with just over one-fifth of the total supply.

In the coming years, it is also the Black Sea coast that will likely register the biggest expansion in supply, but new aparthotels are also set to be actively emerging on the Caspian Sea coast, in Dagestan.

In coastal regions (Krasnodar Krai, Crimea, Dagestan), aparthotels under construction already amount to more than a quarter of all multi-unit residential real estate under construction and this figure is expected to grow further.

There is also an increase in the construction of similar projects in other resorts across the country, for example, on the Baltic coast or at mountain and spa resorts in the North Caucasus, the Altai Mountains and the Urals, among others.

For more information and forecast for non-residential construction and the rest of the Russian construction market, consult our current report or the next report scheduled to be out on 12 December.

EXPO 2027 boosts Serbian non-residential construction

Posted on by efalucskai

Written by Dejan Krajinović, Beobuild Core d.o.o., EECFA Serbia

Overall construction output in Serbia is expected to decline this year, primarily due to the slowdown in civil engineering as several major road and railway projects were completed last year. By contrast, non-residential construction has entered a new growth cycle driven by investments connected to the hosting of EXPO 2027 in Belgrade. The event will be held in a purpose-built exhibition complex in the outskirts of the city, covering around 80 hectares. Alongside the construction of this complex, numerous public and private investments are indirectly tied to the event, including new hotels, accommodation, leisure, and commercial projects, as well as the reconstruction of museums, cultural heritage sites, and public spaces.

Aerial photo of the construction site of the EXPO 2027 complex – Photo: beobuild.rs

The EXPO 2027 complex itself is a vast construction site, comprising approximately 230,000 sqm of exhibition pavilions, multifunctional venues, congress and conference halls, as well as office and retail space. In addition, a residential complex with around 1,500 units is being built to house participating delegations. The exhibition will run for 93 days, from 15 May to 15 August 2027, featuring around 130 countries and hundreds of events spanning sports, science, culture, and innovation. Total investment could exceed EUR 2.5 billion, with EUR 1.5 billion allocated for the EXPO complex and a further EUR 1 billion for accompanying facilities and infrastructure. This project has been the key driver of growth in non-residential construction and is expected to sustain activity in the sector in the coming years.

The broader development zone around the EXPO 2027 complex extends far beyond the exhibition center itself. While the core site covers 80 hectares, total development area exceeds 200 hectares. It will include the new National Stadium complex, a center for aquatic sports, a theme park, recreation facilities, and hotels. The National Stadium alone is a EUR 600 million project, designed with 52,000 permanent seats and the capacity to expand by an additional 8,000. Construction began in early 2024 and, despite delays, it is expected to be completed in time for 2027. Other sporting and leisure facilities are also planned for delivery ahead of the event, though it remains uncertain whether all projects will meet the deadline.

Several other public and private developments across Belgrade are linked to the exhibition, including the reconstruction and expansion of museum facilities: a new Natural History Museum building, the relocation of the Nikola Tesla Museum, the renovation of the Aeronautical Museum, and the modernization of the City of Belgrade Museum, among others. The private sector is likewise preparing for the anticipated rise in visitors, with investments in accommodation accelerating. Notable projects under construction include new hotels under the Intercontinental and Ritz-Carlton brands, alongside numerous smaller ventures.

However, the high level of spending on the EXPO 2027 has placed considerable strain on the state budget. To maintain fiscal deficits at around 3% of GDP, funds have been reallocated from other public projects. This has been most evident in infrastructure development and civil engineering, where shifting priorities have led to significant delays on major planned projects. As a result, civil engineering output is contracting faster than expected in 2025, with negative implications for growth in 2026 as well. On the other hand, long-term economic benefits of hosting EXPO 2027 remain uncertain.

After the event concludes, the EXPO 2027 complex will be repurposed as the new Belgrade Fair Complex. The current fairgrounds in central Belgrade, built in the 1950s, are planned for redevelopment once operations move to the new site. This ensures that the EXPO facilities will continue to be used in the years ahead, supporting the economic rationale for the project. Moreover, new transport infrastructure, including a railway link to the city center, river dock facilities, and expanded commercial developments, should further enhance the attractiveness of the location for private investment.

Forecast up to 2027 for the Serbian non-residential market and for the rest of construction subsegments is available in the 2025 Summer EECFA Forecast Report Serbia. To order it or to request a sample report, please contact us.