PIPELINE : LATIN AMERICA
“ EVERYBODY TALKS ABOUT CHINA BECAUSE THERE ARE A LOT OF [ CHINESE CONSUMERS ], BUT THERE ARE A LOT OF BRAZILIANS AS WELL . THEY HAVE LARGE FAMILIES WITH A LOT OF KIDS , THEY SPEND A LOT AND THEY WANT TO SEE THE GREAT CITIES OF THE WORLD .”
– DANNY HUGHES , LATIN AMERICA SENIOR VICE PRESIDENT , HILTON WORLDWIDE
REGIONAL ROUNDUP
VENEZUELA : Sentiment on Venezuela ’ s future as a hotel market is overwhelmingly pessimistic . “ Each country in Latin America has a lot of good stuff going on ; the glaring exception is Venezuela ,” says Danny Hughes , Hilton Worldwide ’ s Latin America senior vice president . But the country has its proponents , like Tivoli Hotels & Resorts CEO Alexandre Solleiro , who hopes the March death of leftist President Hugo Chavez is the first step toward getting the country ’ s once-robust hotel market back on track .
NICARAGUA : Nicaragua has lately cultivated a reputation as an idyllic retirement destination , and some believe the country can similarly become a popular tourist locale . “ We ’ re very eager to have Nicaragua become the new Costa Rica ,” says Wyndham Managing Director Daniel del Olmo . Wyndham enters Nicaragua next year with the 212-key Wyndham Milagro del Mar near Managua .
ECUADOR : Ecuador is high on the list of growth opportunities for IHG , says Latin America COO Alvaro Diago . IHG recently opened Holiday Inn Guayaquil , the group ’ s second hotel in the country , and has another Holiday Inn in the pipeline at the Quito airport .
BOLIVIA : Accor is planning the country ’ s first upscale hotel . The project under development by Suan Group is slated to open in Santa Cruz in 2016 .
PANAMA : The 118-key JW Marriott Panama Golf & Beach Resort , opened in January , is already doing strong business . Ongoing expansion of the Panama Canal and increased airlift are expected to help improve the country ’ s economy going forward .
“ It might sound aggressive ,” says Regional Vice President Craig Smith , “ but it ’ s not as aggressive as we ’ d like .”
In terms of top-line RevPAR growth , Latin America is leading the way for Starwood Hotels & Resorts Worldwide , which is targeting 100 hotels open and under development in the region by year ’ s end . Starwood had 73 hotels open in 13 countries as of July , with 20 more in the pipeline . Unlike most international groups , Starwood ’ s expansion in the region features a larger proportion of upmarket projects — new W Hotels in Bogotá , Mexico City and Panama City , and a third St . Regis for Mexico .
Strategy evolves with demographics Expanded middle classes combined with strengthened networks of affordable , short-haul airlift are making intraregional travel commonplace for the first time and diminishing the importance of American and European business . “ Where years ago we were probably 80 % North Americans in our hotels , now it ’ s probably 50-50 , and it ’ s going to move into the 60s and 70s ( percent Latin Americans ) in the near future ,” Smith says .
The rise of the middle class likewise means redoubled attention from international brands looking to court outbound Latin America travelers by establishing local footprints . “ Everybody talks about China because there ’ s a lot of [ Chinese consumers ], but there are a lot of Brazilians as well ,” says Danny Hughes , Hilton Worldwide ’ s Latin America senior vice president . “ They have large families with a lot of kids , and they spend a lot , and they want to see the great cities of the world .”
Wyndham aims to open some 200 Super 8 properties in the region over the next decade , explicitly targeting Latin Americans traveling beyond their own borders for the first time . “ They ’ re traveling to these secondary and tertiary cities where it ’ s mostly unbranded hotels that are providing overpriced , inconsistent product ,” says Wyndham Managing Director Daniel del Olmo .
New investment is concentrated in the select-service segment , says Ricardo Mader , executive vice president of Jones Lang LaSalle Hotels in Brazil , with the most active investment markets for the segment being Brazil , Colombia , Peru and Chile . In Mexico and the Caribbean , however , STR reports a pipeline overwhelmingly dominated by upscale and higher . Of the 21,858 guestrooms in the active pipeline as of May , 60 % are categorized as upscale , upper-upscale or luxury , with more than half of those falling into the highest tier .
48 HOTELS September 2013 www . hotelsmag . com