What’s new in hotel investment in South America?

What’s new in hotel investment in South America?

The hospitality industry in South America presents some exceptional opportunities, with selected markets in Brazil and Ecuador as the current focus of active investment. According to consultants, this part of the world has great potential because of local and international demand, particularly in hotel investment in South America.

Top Hotel News recently interviewed two regional experts in hotel consultancy, Richard Katzman and Fernanda L’Hopital, both from HVS and based in Mexico City and Buenos Aires, respectively. In the interview, the experts explained what they see as new in this niche of hospitality investment.

Best opportunities for hotel investment in South America

The consultants advocate a market-by-market evaluation given the varying nature of hotel investment in individual countries. They also point out that resort investment has “different drivers”.

With this in mind, they highlight the current active hotel investment in Brazil and Ecuador. And for the longer term, Katzman and L’Hopital suggest that coastal areas present potential because of “a greater focus on regional planning and tourism development”.

Advantages of investing in hotels in South America

Both consultants highlight the region’s potential for growth in tourism, at regional and international levels. This demand features as one of the main advantages of investment at the moment.

They point out that one of the current trends in emerging economies like those in South America is to “introduce or expand the presence of domestic and international brands”. Examples include the acquisition of the regional hotel chain Atton by Accor, AM Leisure by Hyatt and Hoteles Royal in Colombia by NH Hotels.

Resort development presents most popular opportunities

Katzman and L’Hopital agree that hotels within resort developments are currently the most popular investment options in South America. They emphasise that countries such as Brazil and Colombia offer “opportunities for further development in the near- to mid-term”.

Perspective for the next few years

The final part of the interview centred on the future prospects for hotel investment in South America. The consultants believe that the current pipeline is “moderate but growing”, particularly as many countries are still recovering from the effects of zero tourism during the pandemic.

However, as tourism returns to its pre-2020 levels, Katzman and L’Hopital expect development pipelines to grow with “specific opportunities in prime and secondary locations”. They point out that there’s obvious growth in “traveller demand for differentiated experiences”. As a result, they believe that many countries in South America are “well-positioned to expand their participation”.

(Source: Top Hotel News)