The last decade has seen a tourist boom in Latin America which has spurred a multitude of new hotel projects. As a result, Latin America now has traditional international properties, regional chains and independent hotels that each add to the vibrant market mix. Both large projects and small developments are seeking to attract a share of the growing demand. Real estate is scarce enough in major cities that old neighborhoods are reinventing themselves in order to keep pace with the growth and draw investment.

Latin American countries performed well during the financial crisis. The economies of Peru and Colombia were in good shape and Chile’s success has been widely recognized. In contrast to the European and North American hotel markets which are suffering double-digit revenue per available room declines, hotels in most Latin American countries are better positioned to weather the challenging economy because they were able to maintain high rates during 2009. The strong performance of the Latin American hotel sector will likely lead to more heavy investment and development.

Industry professionals concur that the market is “on the move” with recent openings, high rates and some clear signs that this trend should continue throughout the next years. Brazil will receive the greatest volume of investments primarily from international groups, driven by upcoming international events like the 2016 Olympics. International brands are taking notice.  Starwood Hotels & Resorts Worldwide is investing in Peru and has just opened the first of three Luxury Collection hotels. All facilities will be operated through a franchise agreement with Libertador Hotels, Resorts & Spas. International development and local flavor are reshaping the Latin American hotel market.

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