“Croatia is one of the last remaining unspoilt canvases in Europe,” says Julian Houchin, commercial director of iO Adria, “and we aim to be its leading provider of leisure and hospitality.” And the UK investment company has raised funds of more than €187m (us$230m, £148m) for this purpose.

I met the engaging and energetic Houchin at its first site, the Dubrovnik Sun Gardens. Perched on the stunning Dalmatia coast, where the mountains drop into the sea, this 18-hectare (44-acre) site in the country’s capital was the holiday destination for rich communists in the 80s – when Croatia was part of Yugoslavia – and a prisoner of war camp during the Balkans war. Today, it’s a five-star integrated resort, featuring the first Occo spa – a concept and product line focused on all things Croatian.

“In the 80s, Yugoslavia was high volume, low spend, but tourism is now moving towards the luxury end,” explains Houchin. “Croatia is now a playground for the rich and famous and the flights are starting to come back. We have visitors from 142 countries, 18 per cent of our visitors are from the UK, with a fairly even split across the rest of Europe and the rest of the world.”

With its acquisition of Dubrovnik Sun Gardens in 2009, iO Adria inherited a Radisson Blu hotel and a 2,500sq ft (762sq m) spa by Anne Semonin – Radisson’s spa partner. After 18 months, Anne Semonin was replaced by Occo and iO Adria took over resort operations. Overall, the development cost €130m (us$160m, £103m) “I rolled up my sleeves, and came in as sales and marketing director and we put €1.8m (us$2.2m, £1.4m) on the room’s revenue within 12 months, achieving a 24 per cent uplift,” says Houchin.

CROATIAN SPA BRAND
IO Adria considered other spa franchises, but found their projections unambitious. “They estimated a profit would take eight to 10 years, we wanted it in three, so set about creating our own spa brand,” says Houchin. It teamed up with UK-based spa consultant, Anna Doyle, to create an exclusive concept and product line which was rooted in Croatia. Doyle travelled to iO’s seven development (see p66) to take a look at the local foliage, so each property had its own range and identity, using natural, local ingredients. Think costal rosemary and sage; deep forest cypress leaf and pine extracts; and grape, blackberry and figs from Istrian vineyards.

To raise brand awareness, the products were sold at high-end London department stores, such as Harrods before the spa was up and running. This has stopped now the spa has launched. Since the Occo brand has been introduced, the spa has started to gain more recognition and last year it won the best newcomer award in the digital magazine The SPA Traveller Awards.

Soothing beiges and creams are used throughout the debut Occo spa, with Italian marble flooring adding a touch of luxury. The 46sq m (151sq ft) gym by Technogym, the 18m (59ft) freshwater pool, the thalassotherapy pool and heated benches are all positioned to the front and enjoy views of the sea. The relaxation room is also at the front, but spa manager, Adriana Barlafa, says it’s shrouded by curtains so people will focus inward when they chill out on the cushions and loungers, sipping on herbal teas.

The 12 treatment rooms are named after flowers and the most impressive is the couples suite featuring two heated Nilo massage tables, a spa bath and cushions for relaxing post-treatment – the 140-minute couples ritual allows 30 minutes of private time, when fresh fruit and smoothies are served from the spa’s Vitality bar.
The spa’s heat experience area comprises a coal sauna, salt sauna, aromatherapy steamroom, hammam, plunge pool and showers, all from Klafs. Nine therapists work at the spa and are employed all year round, plus there are two seasonal workers, who aren’t trained in all the treatments.

SPA SWEETENER
Barlafa has put together the treatment menu with highlights including three 30-minute, €42 (us$51, £33) bath options using Occo products mixed with Adriatic sea salt. The most popular treatment is the 55-minute signature holistic massage (see p66) priced at €80 (us$98, £63). Two new brands are being introduced this season: Maria Galland for corrective facials and Beyond Spa for cosmetic teeth whitening. There will also be three new treatments from Germaine de Capuccini – gold therapy, an anti-ageing wrap and massage using golden algae; a massage with shells; and an anti-cellulite treatment. “We have gone for shell and gold therapy because they are high-end treatments and because they give our guests an experience they would not receive at many other spas,” says Barlafa.

As well as the 201-bedroom hotel, the resort has 207 apartments, which are being sold as holiday homes. The aim it to attract a steady repeat custom from wealthy people and as a further sweetener, residents receive a 20 per cent discount at the spa. “When one of our owners, who is from the Czech Republic, came with his two daughters, they each spent €300 (us$368, £237) a day, for a week, at the spa,” says Houchin. “The spa is a very important part of the overall offering, but it’s hard to quantify exactly how much value it adds. It is smaller than both the conference and F&B businesses – we have 13 restaurants – but it’s a very important element of the resort experience and decision making process. Each unit is run as an independent profit centre and we give our managers autonomy in cost control.”

DESTINATION SPA
Dubrovnik is still a seasonal destination with the spa at its busiest – performing 30-45 treatments a day on average – in the peak from June to mid-September. “We are focused on generating business during the low and shoulder season [October to May],” says Houchin, “and as a result the first three months of this year saw room revenues increase by 77 per cent.” Much of the winter trade comes from the MICE market, special interest groups, the senior citizen market and the Japanese, however, plans are to push the spa as a destination in itself.

During the winter, the spa is sold more aggressively to the local market which accounts for 20 per cent of customers on average. Spa membership is offered for €66 (us$82, £52) a month, with a 10 per cent discount on treatments. To avoid over crowding, memberships are limited to 30 people, but day passes are available for €25 (us$31, £20). Ladies nights are also being introduced, where a group can have private use of the spa, treatments and champagne, which costs €240 (us$296, £190) for three hours.

Going forward, Barlafa says her target is to make the spa a year-round destination. For Houchin, after successfully repositioning the resort to compete with other leading five-star integrated resorts in Europe, his focus is selling the residences and says that early indications are strong with interest coming from a varied mix of source markets.

But development doesn’t stop there. There are already plans to add another five-star hotel with 120 bedrooms onsite, plus 200 more residences. And elsewhere in Croatia iO Adria plans to spend upwards of €1bn (us$1.2bn, £0.8bn) on developing seven other sites. These include three in Istria which will be designed as small boutique golf estates with spas; three boutique marina resorts in northern Dalmatia and an island resort planned on the island of Sipan near Dubrovnik Sun Gardens. The idea is that each spa will be slightly different, but the details are yet to be confirmed. If Occo is the benchmark, they’re sure to be exciting.

For more on Croatia’s growing spa tourism market see Spa Business, issue 2, 2010, p38