The Top Hotel Investment Markets in Latin America for 2011 are Bogotá, Buenos Aires, Lima, and Santiago.

Bogotá, Buenos Aires, Lima, and Santiago, according to a recent Jones Lang LaSalle hotel investment research, emerge as significant strategic markets for Latin America in 2011. real estate qatar

FocusOn: Strategic Spots for South American Hotel Investment, a Jones Lang LaSalle Hotels proprietary research report, identifies four of the most promising South American hotel investment areas. The list was created based on the market’s strong demand fundamentals and the possibility for investment-grade branded supply. While Brazil, by far the largest economy and most populous country in South America, offers the most diverse range of growth opportunities, a number of cities in other countries, including those outside of Brazil, have strong demand fundamentals and a favorable investment environment, resulting in real estate opportunities.
“Bogotá, Colombia; Buenos Aires, Argentina; Lima, Peru; and Santiago, Chile are four of the main markets,” said Ricardo Mader, executive vice president of Jones Lang LaSalle Hotels in So Paulo. “Through 2015, real GDP in these countries is expected to rise at a compound annual growth rate of 4% or more, significantly above growth rate predictions for most mature economies.”
Because of the country’s relatively sophisticated financing markets, Santiago has been a favoured site for hotel investment. Santiago has frequently served as a test market for international brands entering South America. As a result, of the four cities in the survey, it has the most international-grade, four- and five-star hotel rooms.
Santiago’s market will continue to provide opportunities for the development of new hotels in the long run due to the country’s stability and economic possibilities.”
The most sought-after areas for hotel development are now Las Condes and El Bosque. Because the city’s luxury market is well-served, the main prospects in Santiago are to build both limited service and upmarket hotels, or to make strategic acquisitions and conversions to create a foothold “Mader stated.
After So Paulo, Buenos Aires is the second largest metropolitan region in South America. “Despite major performance decreases in 2009, visitation trends and economic fundamentals are improving, and investors continue to pursue investments in Buenos Aires on a selective basis,” said Clay Dickinson, executive vice president of Jones Lang LaSalle Hotels.
There are 14 hotels in the city with institutional-grade, four- and five-star accommodations, totaling roughly 3,200 rooms. “With the opening of around five new hotels, this hotel category is likely to rise to 3,800 rooms by 2014,” Dickinson added. The tiny initial base of rooms will assist prevent an oversupply from developing in this development pipeline. “The sustained appeal of Buenos Aires as South America’s foremost tourist destination is projected to deliver satisfactory operating results for existing and new hotel supply,” Dickinson added.
The need for hotels in Bogotá, Colombia’s main entrance and distribution hub for tourists throughout the country, is increasing. Colombia is on the verge of regaining its footing. According to Cotelco, RevPAR at Bogotá hotels increased by 4% year-to-date in July 2010 compared to the same period the previous year.
Due to the country’s prior political turmoil, unlike So Paulo and Santiago, Bogotá has not seen a substantial quantity of hotel construction in the last 15 years. “With the installation of several new hotels, this has now changed. Furthermore, between now and 2012, the stock of institutional-grade, four- and five-star hotels is forecast to increase by 37%, presenting a plethora of investment opportunities, including prospective conversions and management contracts “Dickinson stated.
Lima has witnessed less international hotel development than Buenos Aires and Santiago, and the market still lacks the breadth of international hotel brands found in other cities. “Only three institutional-grade four- and five-star hotels are anticipated to open in the city of nearly nine million people during the next three years. Because the city is not experiencing a surge in new supply, growth in operational fundamentals is projected to be sustained over the medium term “Liliana Ribeiro, vice president of Jones Lang LaSalle Hotels in So Paulo, shared her thoughts.
There are still market potential for the creation of new hotels across all categories in Lima, as the city’s economy continues to grow. “There is almost no presence of luxury branded select service hotels in Lima, and this remains an investment potential,” Ribeiro added.
Domestic and foreign hotel investors should keep Bogotá, Buenos Aires, Lima, and Santiago on their radars as economic and demographic trends in the cities continue to grow, resulting in a variety of intriguing hotel investment opportunities.