Held last month in Miami, the annual Hotel Opportunities in Latin America (HOLA) investment conference explored factors impacting hotel development in Latin American economies and the potential for expansion. The three-day conference covered extensively the ongoing decline in the price of commodities as a result of a five-year economic slowdown and regional recession. The event also tackled the potential for the growth of branded properties as a result of increased travel among Latin America’s middle class.
The downgrade in commodity pricing from oil to grains has affected Latin American countries that rely heavily on production and exportation of such goods. Currencies across the region have depreciated as a result, leading to lower consumer spending. Low exchange rates, however, have created opportunity for increased travel from the U.S. into the market.
Although the economic outlook for the region remains uncertain, some countries have seen an influx of hospitality development in recent years. Mexican and Chilean economies continue to grow at the highest rate in the region thanks to the success of their manufacturing and hospitality industries. Supply growth is predicted to slow down considerably in Brazil and Colombia, while Peru is slated to become the dominant force in the region’s hospitality pipeline in the coming years.
Latin America is currently considered undersupplied, maintaining a low volume of branded hotels with only 46 percent. Those attending the conference were in general agreement that a transition from independent to more branded hotels would increase middle class travel, and it was estimated that by 2025 branded hotels would account for 55 percent of lodging in the region.
