Hotels retreat in Brazil and grow in neighbouring countries

The recession and political instability in Brazil, the largest market in South America, pull down the performance of the hospitality industry on the continent, despite positive operating data in other countries relevant to tourism in the region, such as Colombia, Peru, Chile and Argentina, the annual study "Panorama Hotel in South America", released by HVS-American consulting firm, with 35 offices in the world-in association with HotelInvest and STR using data from 76 1000 units of five countries.
"Last year there was expectation that the picture could improve in Brazil. In 2016, we''re in knowing it will be a more difficult year for the country, with a tendency to get worse, "said the General Director for South America of the HVS, Christian Valentine.
The hospitality in all Brazilian capitals surveyed suffered from the lowest corporate demand, which resulted in lower occupancy rates and revenue.
The retractions of operational indicators in hotels in the cities surveyed by the HVS varied, for the occupancy rate among 1% (in Curitiba) and 19.3% (Belo Horizonte); for the daily, between 0.4% (Sao Paulo) and 20.3% (in the State capital); and RevPar-average revenue per available room-, of 2.6% (Curitiba) to 35.7% (again in Belo Horizonte).
The capital of Minas Gerais suffers from enlarged evil way which led to the slowdown of the hospitality in Brazil-investments that were made at the time the country grew and enjoyed higher demand because of the World Cup, but whose only ventures are ready when the recession have dominated the local market.
In Belo Horizonte, supply grew 33.5% between 2013 and 2015. "The mismatch between supply and demand will persist," said Valentine. According to him, this same phenomenon can reach the hotel market of Rio de Janeiro, after spending months in August and September that the city gets the Olympics and Paralympics. With the proximity of these events, several hotels are being opened.
In 2015, 4,277 new rooms were opened, with 65% of the total in Barra da Tijuca. The growth of supply combined with the drop in demand brought about in 2015, 14% drop in hotel occupancy. "More hotels will be opened in 2016. The demand generated by the games will help performance, but promptly, "pointed out Valentine.
Despite the retraction of the hospitality in the largest South American country, HVS, and STR HotelInvest indicate that prospects are positive in the region because South America was cheaper for travellers.
In the continent''s second-largest economy, argentina, business confidence increased after the election of President Mauricio Macri. As early as 2015, despite the slight fall of 0.5% in occupancy rate, Buenos Aires presented increase in revenue per apartment available (RevPAR) in 6.1% and the price of the average daily rate in 9%.
"What is happening in Buenos Aires today can repeat itself at São Paulo in 2017," said Valentine. "When the brazilian economy resume, there will be improvement of operational indicators, especially in markets like Sao Paulo, where the supply stopped growing quickly," said the Director of HVS.
The tracing framework for Chile is also of growing demand, such as in Argentina. With the 22% increase in arrivals of foreign tourists last year in the country, the hospitality industry in the capital Santiago captured 6.6% average daily in 2014.
"Chile is very dependent on commodity, and the decline of this sector affected came to affect business travel. But as the Chilean market is more mature, no increase in supply, there was room for advancement of the RevPar in hotel management, which is also advancing in leisure tourism, "pointed out Peter Executive also Cypriano HVS and responsible for the study.
In Peru, the economic growth is the largest vector of hospitality, especially in Lima, with business travellers. The opening of the Convention Centre in the capital and the largest foreign flow feed sector, says the HVS.
The Hotel Park of Lima recorded 11% of average daily gain and 4.6% in RevPAR. "There is an investment in infrastructure and in promotion of Peruvian destinations, which has attracted more leisure travelers as well as tourists", pointed out Valentine.
"The growth of the economy and corporate tourism in the country indicates favorable scenario for the sector''s profitability in the short term," says HVS Executive, citing Peruvian GDP, which grew 2.7% in 2015 and has further projected 3.4% in 2016.
In Colombia, the average daily rate in hotels of Bogota grew 13% between 2014 and 2015, even with an increase of the offer of the order of 9%. Capacity expansion to about 4 1000 beds, was fed by the policy of tax breaks for the construction of new hotels, which ends this year.
"The leisure market in Colombia has benefited from accelerated the process of pacification and the favorable exchange rate, which will benefit the country''s image as an international destination, attracting more leisure tourists," said Pedro Cypriano, of HVS.