SAO PAULO, Sept. 24, 2013 /PRNewswire/ -- Big changes are on the horizon for the Latin America lodging industry as more than 425,000 new rooms are expected to be required throughout the region over the next 10 years. According to an industry-sponsored white paper prepared by Jones Lang LaSalle, "Economic Transformation Drives Latin America's Lodging Industry," a surge of hotel opportunity is predicted for the coming decade in Brazil, Mexico, Colombia and Peru. The research found that the four countries face a crucial inflection point, and are poised to undergo rapid, largely domestically driven economic growth reminiscent of the United States and other mature economies in decades past.
Check out a video summary of the white paper: http://www.youtube.com/watch?v=f8BHU2R1RNU
Jones Lang LaSalle forecasts the gross room supply growth for these four countries at 425,900 rooms, representing a compound annual growth rate of 5.2 percent and an absolute percentage increase of more than 65 percent over a 10-year period.
The research includes data from a wide variety of sources on 1,100 projects located across 900 cities and towns in Brazil, Mexico, Peru and Colombia. Combined, these countries account for nearly 70 percent of the total population in Latin America (excluding the Caribbean) and approximately 75 percent of the region's GDP."Every calculation points to a disproportionate increase in the amount of hotel and timeshare development required to satisfy projected demand within those target countries," said Clay Dickinson, Executive Vice President of Jones Lang LaSalle's Hotels & Hospitality Group responsible for the Latin America region. "These countries are still at the initial stage of their transformation toward services-oriented economies." Included in the findings are the two primary driving forces behind the regional economic growth, and the pronounced increases in required hotel supply. The first is this transformation to a high proportion of service-oriented industries, economic activities which have been demonstrated to be strong generators of hotel demand. In the aggregate, nearly 60 percent of the productive activities of Brazil, Mexico, Peru and Colombia are services-oriented. The second driver that not only underscores the macro-level economic transformation underway, but supports outsized growth in required hotel development is the sheer volume of public and private sector investment in thousands of infrastructure, industrial, mining, manufacturing and services-oriented projects across these countries. For example:
- the world's largest iron mine is expected to create some 30,000 new jobs in Parauapebas, Brazil;
- the $4 billion Bicentenario pipeline will connect Yopal, Colombia and its newly discovered oil fields to the Caribbean at Puerto Convenas by 2015;
- Mexico's new Durango- Mazatlan superhighway will dramatically improve travel time from eight hours to just three; and,
- Peru's $50 billion backlog of announced gold, copper and other mining activity will stimulate road and maritime infrastructure projects, including a $600 million investment in the Almirante Miguel Grau Port facility.
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