Jazzing Up Jaffa: Hotels Are Conquering the Shore

Tourists visit, eat, drink and spend in Jaffa, but go back to Tel Aviv to sleep. That is about to change.

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The true proof that a city is a major international tourist destination comes when major hotel chains decide to open up new hotels there. In Jaffa, this happened a year ago when Starwood Hotels & Resorts announced it would open its W Tel Aviv-Jaffa hotel during 2016. But W will not be alone: It is only the beginning of the major hotel development spurt that Jaffa will enjoy over the next two years.

The Atlas boutique hotel chain is scheduled to open its Market House hotel in another month in the Flea Market area. In early 2016 the Orchid chain, owned by the Nakash brothers, is scheduled to open a hotel in the Clock Tower area, the leading tourism site in Jaffa. Later that year another boutique hotel is planned to open in the port area, though this is still in the final stages of receiving its building permit. All told, by the end of 2016 there should be 350 new hotel rooms in Jaffa. Today, tourists make do with only 60 rooms in total, all of which are in the Ruth Daniel Residence, a guest house on Jerusalem Boulevard.

Tel Aviv also suffers from a severe shortage of hotel rooms, and during many periods of the year all the hotels in Tel Aviv are full - and room prices also skyrocket as a result of the heavy demand. The developers of the Jaffa hotels certainly think the Tel Aviv occupancy rates reflect a rosy future.

The average occupancy rate for Tel Aviv hotels was 72% in 2012 and 2013. The average for all of Israel was 6% to 65% for those years. Most hotel stays in Tel Aviv are by tourists, and in particular business tourists, and it is expected the numbers for Jaffa will be similar: In 2013, the number of tourist overnight stays in hotels hit a record of 2.34 million nights, up from 2.24 million in 2012.

Jaffa’s potential as a hotel destination has never been met. The Tourism Ministry estimates that 51% of tourists coming to Israel visit the Old City of Jaffa - and only the tourist sites in Jerusalem show higher numbers. Still, all these tourists, and many Israelis, come to Jaffa for the day, enjoy it through the late evening hours - and then sleep elsewhere.

Until a few years ago, just the idea of a fancy hotel in the Jaffa Flea Market would have sounded crazy. But over the past decade Jaffa has undergone a revolution, which started when the Tel Aviv-Jaffa municipality and the Tourism Ministry invested tens of millions of shekels in renovations and development of infrastructure in the area. As a result, the Flea Market complex turned into a center of nightlife with restaurants, coffee shops and bars, which draw thousands every day and night, and the Jaffa Port area changed its spots from a fishing anchorage to a place where families come on the weekends for food and shopping. “The dramatic change in the infrastructure created an area for tourism that draws demand for [hotel rooms]. This created an incentive for developers and gave them an appetite,” said the director general of the Tourism Ministry, Amir Halevy.

Atlas Hotels interest in the property in Jaffa started a decade ago, though the deal was only signed two years ago, said Danny Lipman, the director of the chain, along with his partner Leslie Adler. Back then Jaffa was nowhere near as desirable as a nightlife or tourism center, said Lipman. “But we loved this specific property very much and we hoped that Jaffa would develop in the direction it did develop in the end. We believed in the city’s plan,” he said.

The new hotel’s strongest point is its location, which allows different views. “When I travel to a city overseas, I look for the ancient center. Here on one side we see churches, on the other side mosques, and also modern Tel Aviv, and on the horizon the sea. It is simply amazing. When we thought about the design concept of the hotel and what atmosphere we wanted to create, we went with the most obvious thing, and put Jaffa inside the hotel. It is expressed the minute you enter: For example, we hung pictures of well-known figures from the area close to the Flea Market who agreed to have their pictures taken: a fisherman in the port, a merchant in the market. The visitor can look for them,” said Lipman.

During the years they were thinking over the purchase of the hotel property, the management of Atlas studied how the average tourist would feel in the area of the hotel in the evening, questioning whether it felt safe enough. They wandered the area at all times of day and night, and put themselves in the tourists’ shoes. At first, the feeling wasn’t the best, admits Lipman. But by the time they signed the deal the situation was completely different.

“I myself am amazed week after week, when I see another business opening and in another place they have started renovations. It is all developing dramatically here,” said Lipman.

One thing the new hotels in Jaffa probably will not offer is low prices compared to Tel Aviv. “The direction is about $450 per night for a private customer, but many of the customers will be groups that pay a lower price,” said Shahar Perry, the CEO of RFR Israel, which is developing the W Tel Aviv-Jaffa hotel in sight of the old French hospital and hostel on Yefet Street - at a cost of over $50 million. He said they expect to be the market leader in price, and the location is at least as good if not better than the traditional seaside line of hotels in Tel Aviv - and the product is at the high end of the scale for Tel Aviv hotels, said Perry. The hotel will also have a wing of 38 luxury apartment residences alongside it, at prices ranging from 3.4 million shekels to 58 million shekels.

The Nakash brothers hotel is the most expensive to build. It is located in the old police station of Jaffa, near the port and the sea - and at an investment of 300 million shekels. The jail in the police station once held Adolf Eichman, and will have 105 rooms when it opens in 2016. The owners originally planned on investing only 100 million shekels in the project, after buying the land from the state for $12 million in 2006. But they erred in not taking into account the enormous costs of preserving and restoring the historic building. The room prices are expected to be similar to its new competitors, and basically the same as in Tel Aviv. The distance between the Park Plaza Orchid Hotel Tel Aviv and the new Orchid in Jaffa is only 150 meters, said Avi Homero, the CEO of Nakash’s Jordache Enterprises, the group developing the hotel.

Even though the opening is just around the corner, Lipman says they have still not set room prices. The rooms will priced similar to other boutique hotels in their prime Tel Aviv locations, such as on Hayarkon Street. The location in Jaffa is no worse than the one opposite the Hilton Hotel in Tel Aviv, he said.

As for more hotels in the future, there are plans for three more on state owned land south of the port area, which is now a parking lot. But there are problems with the parcel and it is not clear when anything might actually be built there, said Ami Katz, who is the director of the municipal agency in charge of Jaffa. There is, Katz says, very little available land in Jaffa left.

Moshe Gilad