Rapidly growing start-up from the CEE region, developed by Croatian entrepreneur Dino Karic
How the student project emerged as one of the fastest-growing tourism start-ups in this part of Europe (i.e. CEE and SEE regions), a story by Poslovni dnevnik published on May 11, 2022.
To read the full article in Croatian, click here.
As early as during his internship in the famous luxury hotels, while studying economics, management, and hospitality in Switzerland, young entrepreneur Dino Karic understood the transformation currently happening in the tourism and real estate industries. This change became even more inevitable during the Covid pandemic.
Partly through his experiences as a guest, he understood that the market cannot cover the needs of a large part of today's modern travelers, who lack a flexible offer of short-term and medium-term accommodation, and the traditional hotel offers do not suit their needs and their way of living and traveling.
On the other hand, hotel and traditional rental investors are seeing their margins tighten, with rising business costs and an increasingly difficult struggle with the workforce and recruitment.
What is very important for the real estate investors is that through our concept we can significantly reduce the costs, up to 40% .
Therefore, hybrid forms of accommodation enabled by technology advancements are the fastest-growing segment of tourism and residential real estate management worldwide. In this part of Europe (i.e. CEE and SEE regions), the startup project WalQinn is growing rapidly. Only six years ago, Dino and several friends and colleagues launched a student project with several apartments in Sarajevo, and today the company grew to 250 units in five countries, and for the moment, many new destinations are in the development phase.
By the end of the year, WalQinn will have about 100 accommodation facilities in Zagreb, reveals Dino Karić for Poslovni dnevnik. Along with Dino, WalQinn was founded by a French business partner Ethan Benillouche, an equal partner in the company who leads the development and equipping of new real estate, while Dino is serving as the CEO of WalQinn.
The Swiss-based company currently has 40 employees, with an average age of 34. “Interest in our business model is growing among real estate investors. Already during the pandemic, there has been a rapid expansion in the number of property owners interested in working with WalQinn, as well as in inquiries for projects at new destinations.
We work less with the master-lease model and focus on the management contracts. We aim to be a "one-stop-shop" for investors, as we offer everything from design and furnishing to daily management (promotions, cleanings, etc.). Our real estate portfolio targets travelers looking for short-term rent for tourism and leisure, as well as young professionals and digital nomads who look for mid-term and long-term stays.
The purpose of guest visiting also depends on the season, and the benefit of our model is that we can change the guest mix easily, which has been crucial in the recently volatile times. What is very important for the real estate investors is that through our concept, we can significantly reduce the costs, up to 40%, either through different use of space or by benefits of digitalization and automatization." explains Karic.
The guest mix also depends on the locations. At the moment, WalQinn apartments can be rented in Zagreb, Brussels, Berlin, Sofia, and Sarajevo, with most units in Zagreb, where the most guests are the short-term guests.
WalQinn started development in Zagreb in 2018, and after the headwinds caused by the pandemic and earthquakes, the company has been growing rapidly in the Croatian capital since last year, where Dino decided to settle. In Brussels, their portfolio consists primarily of co-living units, and the company is developing two new buildings in the European capital. New markets that are opening soon are Vienna and Belgrade and Athens, which have been under consideration for a long time.
"In Vienna, we took over the management of a 120-room hotel that targeted large organized groups before the pandemic and was closed during 2020. After the renovation of the building, we will have 110 units that will be a combination of serviced apartments and co-living units. We are creating a different brand for this project, as we want to have brand diversity due to different models and levels of service.
Also, instead of the traditional hotel F&B outlets, this facility will operate a "ghost kitchen", which will have more than one restaurant concept optimized for delivery, while the hotel guests will have it integrated through the guest app, which is also used for the automated check-in process. "said Dino.
He takes this project as an example of a model that, with a different F&B concept, significantly reduces the cost of the workforce as it digitalizes the experience.
In fact, the company is constantly looking for larger projects like this Viennese hotel. In Zagreb, they have a similar facility in Petrova Street, and the latest acquisition is a facility with about 50 rooms in Berlin, one of the most vibrant European cities, where WalQinn is developing a similar concept as in Vienna.
Attractive investment opportunity
When it comes to brands, this startup from 2020 is associated with one of the world's largest hotel brands, and part of WalQinn's portfolio from the luxury and premium segment is advertised through Marriott's Homes & Villas platform, including several apartments in Zagreb. Karic points out that WalQinn properties are similar to lifestyle hotels and provide this type of offer and business model with lower operating costs.
"Luxury hotels, summer resorts, and lifestyle hotels will 'survive' in the hotel business. Classic city hotels have already fallen into disrepair because they do not meet guests' needs while having higher operating costs.
That is why projects like this are exciting for investors. We have examples worldwide of startup companies from the industry that quickly went public. Currently, most of the units we manage are owned by individuals, and our goal is to attract institutional investors and real estate developers who see their benefit from it, especially in light of the current inflationary environment.
We already had some offers to sell the company, but it was the midst of a pandemic that brought down the company valuations. We started and developed as a financially sound company, as we needed to make a profit to reinvest it, and we did not want to give up the company at a ‘discount’. The "real" offers are yet to come ", concludes Dino Karić.