KYIV – There’s a history of people becoming entrepreneurs after turning 40. Robin Chase was 42 when she co-founded ZipCar, a car-sharing company whose business model is helping define the so-called new economy. Henry Ford was 40 when he started manufacturing automobiles. Giorgio Armani was 41 when he introduced his haute couture line of clothing.
In turn, Canadian Ukrainian Roman Tatarsky was two weeks shy of his 41st birthday when he and his wife, Kristina, opened On the Square Guesthouse, an 11-room bed and breakfast (B & B) in historic Lviv’s Market Square, or Rynok, five years ago.
His first two guests were from Great Britain. They were in town for the opening of the quadrennial European soccer championship on June 8, 2012, that Ukraine and Poland were co-hosting for a month that year.
“They were excited to be in Ukraine as football fans, and so were we to have them,” Mr. Tatarsky, 46, told The Ukrainian Weekly at an outdoor café in downtown Kyiv on July 25.
On the Square
On the Square Guesthouse is located at 13 Ploschcha Rynok above commercial space.
Lviv’s city hall with its two lion statues nobly guarding the main entrance can be seen from the balcony of several rooms situated inside the early 17-century building, located at 13 Ploshcha Rynok, that dates to when Galicia (Halychyna) belonged to the Austrian-Hungarian Empire.
Mr. Tatarsky, who holds an M.B.A. from Hamilton’s McMaster University in Ontario, consolidated the rooms into a B & B based on what he says was the city’s hospitality segment’s lack of “mid-range” hotels.
“Back in the day… your only option was either post-Soviet crap or high-end hotels,” he said. “I got inspiration from traveling to Europe with my wife, staying at three-star hotels. You… still don’t have them in Lviv to a certain extent.”
So, he found a Canadian equity partner and started scouting the approximately 100 buildings in old Lviv that are about 200 years old.
The B & B’s sign.
Owning four condominiums back in Toronto and a converted triplex, the first-generation Canadian always was fascinated with real estate, although it was never his main source of income. He explains his passion for brick and mortar projects abstractly.
“I walk the streets, I look at buildings, and I love them, I could appreciate them,” Mr. Tatarsky said. “They’re beautiful. Real estate is something you could touch and feel… It’ll be there for a very long time. It really is a true investment.”
But his main line of work was risk management consulting. He was on assignment in Ireland for Pricewaterhouse-Coopers (PwC) when the Orange Revolution erupted in 2004.
“Ukraine started hitting the press and it all looked very exciting. Just after that assignment, I jumped on a plane and came here,” Mr. Tatarsky said.
First, he had to find a job as his position was already filled at the local unit of PwC in Kyiv. So he pounded the pavement and interviewed with the remaining Big Four accounting firms, eventually accepting an offer to head E&Y’s risk management department.
Still, renovating apartments to rent, opening a hotel or re-purposing property was always on his mind.
While still at E&Y (formerly known as Ernst & Young), he spotted a derelict building near Lviv’s central square and consolidated the six flats inside that he eventually leased to !FEST, the group of restaurateurs who run several famous themed eateries, the most notable of which is Kryivka: the subterranean brew house modeled after a bunker of the Ukrainian Insurgent Army, or UPA.
Again, his love for landed property drew him to the spot.
“I was walking around the center. I said, ‘there’s a story to tell here,’” he recounted.
He and !FEST then combined to open Dim Lehend, an eclectic restaurant modeled after a chimney sweeper’s house. The restaurateurs contributed to renovating the place, while Mr. Tatarsky provided a 10-year lease that expires next year.
After the global financial crisis that hit Ukraine in 2008, the native Torontonian found what would be On the Square Guesthouse and embarked on a “grass-roots project.”
This meant “dealing with the actual owners of the apartments living there… Here you have to knock on the door and say, ‘Hi, I’m Roman, I’d like to buy your flat” – which he eventually did.
Roman and Kristina Tatarsky took the plunge eventually and quit their jobs in 2012. Ms. Tatarsky also had a lucrative career working in investor relations for the oil and gas company Halnaftohaz.
“We both took risks, we took pay cuts. She effectively is our CFO – she manages the financials,” he said.
Next came Danylo Inn, on 20 Danylo Halytsky St., another B & B in Market Square that started operating six rooms in October 2015. Mr. Tatarsky brought in four equity partners from Canada for this project.
The simple yet rustic interior showing an exposed brick wall in one of the rooms at Danylo Inn.
Like its predecessor, this building, which was built in 1787, has maintained its architectural integrity as much as possible. Mr. Tatarsky’s concept has been “minimalistic.” He has tried to keep the baseboards intact, has exposed the historic brick walls and preserved the old fireplaces, all the while furnishing rooms with colorful furniture.
At first, many local tourists didn’t quite grasp his vision of not plastering walls or of painting floorboards white, he said.
He broke down his approach this way: “What real estate investment is, is basically taking a real asset and improving it and adding value… and you move it to a best-use scenario.”
In six months, Danylo Inn will have all 45 of its rooms ready for occupancy. Currently, the Tatarskys boast an 85 to 95 percent occupancy rate at their two hotels.
Combined, both projects at turnkey are projected to cost $3.8 million. The yearly return on the investment is currently at “above average” compared to his peers, Mr. Tatarsky said, without providing a percentage figure due to confidentiality clauses he has with partners.
Given his Ukrainian heritage, Mr. Tatarsky said his life in Ukraine has given him both “professional and personal satisfaction.”
“There’s a lot of satisfaction in being able to raise up young professionals,” he said.
The Euro-Maidan revolution has been his most memorable part of living in Ukraine so far. He and his wife visited Kyiv’s Independence Square daily to deliver medicine and food that they had bought during those tumultuous times.
His success hasn’t gone unnoticed. French investors, international hotel chains, as well as others have approached Mr. Tatarsky. Some opportunities that he is exploring include opening a boutique hotel with 40 to 50 rooms and a conference center that could have 250 rooms.
But to “build a country, a vibrant economy” is needed, he said, adding that “I want Ukraine to be a business destination… this is why I’m talking to so many investors… I’m not a politically active person, I believe in contributing this way.”
Mr. Tatarsky noted he employs 27 full-time hotel staff and 15 builders.
Indeed, he has something to look forward to. Last year, according to official statistics, 2.5 million tourists visited Lviv – twice as many as in 2012 during the soccer championship. That figure is expected to keep growing.