Dedeman nears agreement on expansion into three new countries

Dedeman has announced that it is close to signing agreements for new investments in Saudi Arabia, Egypt and Libya. Outlining its international expansion plans, Dedeman Chairman Ergün Demiray stressed the importance of working with the right investors under the franchise model and maintaining service standards. The company now expects its hotel portfolio to reach the 130s by the end of 2027, below its previously announced target of 150.

Agreements nearing signature in three countries, with conditional targets in Europe

Demiray discussed the company’s search for new markets in an interview with Okan Beltek, news editor at Turizm Güncel, published on 24 October 2026. He said agreements for new investments in Saudi Arabia, Egypt and Libya were nearing signature, identifying three countries Dedeman plans to enter in the coming period.

The announcement concerns investments still at the agreement stage, rather than hotels that have already opened. Projects in these three countries should therefore be viewed as expansion plans approaching signature, not completed openings. The stage described by Demiray suggests that the company is preparing for a new phase of international expansion.

In Europe, Germany, France and England are under consideration. Demiray said the company was working towards entering these markets and aimed to open hotels if suitable conditions emerged. He also named Morocco and Algeria as target countries, confirming Africa’s place in the company’s growth plans.

These markets are not all at the same stage of preparation: Saudi Arabia, Egypt and Libya were described as nearing the signing stage, while the three European markets remain targets subject to suitable conditions. This distinction matters when assessing how far the investment plans have progressed.

A more selective approach to the 150-hotel target

The interview also covered Dedeman’s previously announced target of reaching 150 hotels by the end of 2027. While Demiray said that figure was not far out of reach, he expected the company to comfortably reach the 130s by that date.

He gave two reasons for this outlook: the negative impact of conditions in Türkiye and globally on tourism, and Dedeman’s increasingly selective approach to new partnerships. Growth is therefore being assessed not simply by the number of new agreements, but also by the quality of those partnerships.

Uzbekistan provided a concrete example of this selectivity. Demiray said the company could have signed agreements for 10 hotels there at once, but had chosen not to because it did not consider that the right approach. He explained that the priority was to deliver Dedeman’s service properly, rather than pursue growth in numbers alone.

The Uzbekistan example illustrates how the company makes its expansion decisions. In Demiray’s account, the opportunity to sign more agreements in a market is not sufficient on its own. Maintaining the brand’s service standards takes precedence over increasing hotel numbers. Its stated country targets should therefore be considered alongside its selectivity over investors and the implementation of standards.

People and technology take priority over buildings in the franchise model

Discussing Turkish hotel brands’ transition to franchising, Demiray criticised the earlier approach, which largely centred on building their own hotels. He argued that international brands had expanded in Türkiye through franchising while domestic hotel executives had remained reluctant to adopt the model for many years.

Demiray noted that every new hotel requires additional resources and said growth could not be sustained through investment in buildings alone. He identified technology and people as the priorities for investment. For those in the franchise sector, this raises the question of which capabilities a brand needs to develop alongside its physical assets.

In Demiray’s view, the right approach is to grow the brand with suitable investors across different regions, cities, districts and countries. That requires standards not only to be established but also put into practice. Arguing that international competition requires a sustainable network for expansion, he treated growth and service consistency as inseparable.

He also called on Turkish brands to develop their own identities rather than copy one another. His particular emphasis was on maintaining the same service standards abroad as in Türkiye. The decision not to pursue multiple agreements in Uzbekistan was presented as another example of this approach.

Rental costs are a key consideration for investors

Alongside expansion plans, the interview addressed investment costs. Demiray described disproportionate rents as the biggest cost-related problem in Türkiye. According to his comparison, rent typically accounts for 10–15% of turnover internationally, but rises to 30–35% in Türkiye.

These figures reflect Demiray’s assessment of costs. His comments suggest that, when considering a new investment, investors should assess the rental burden the business will bear alongside their choice of brand and country. Viewed together with the company’s emphasis on selective growth, service standards and investment conditions represent two aspects of the same decision.

Practical takeaway: Entrepreneurs considering a hotel franchise investment should look beyond growth targets to assess how service standards will be implemented, what staffing and technology will be needed, and the burden of rent. They should also distinguish between projects nearing signature and hotels that have already opened.