Hospitality Design - December 2011 - 91

forecast

A rendering of a guestroom at the St. Regis Bal Harbour. The exterior of the Aloft Hotel Brussels Schuman.
group earlier this year, but recently the idea of the open, informal, functional living spaces.” Another midmarket focus: Brazil. With the World Cup and Olympics coming to Rio in the next ﬁve years, there’s “an international focus on Brazil,” says Arthur Haast, global CEO for Jones Lang LaSalle Hotels. “Plus, it’s a country of 170 million people, with a growing middle market, and a stable and growing economy. A lot of U.S. brands in the middle market are looking and growing there, and we expect a lot more activity, especially with institutional investors and private equity funds.” However, Brazil is not the only South American country on the radar. “While Brazil continues to be a market of interest to Hilton and its competitors, it is a difﬁcult environment due to high land costs, more attractive alternative uses for the land, limited ﬁnancing, and a generally difﬁcult business environment. Growth in Chile, Argentina, Columbia, and Peru is being driven by high commodity demand and prices. Panama is a regional banking center and the expansion of the Panama Canal is driving investment into the country,” says Wood, who is placing full-service Hiltons in gateway cities (Lima, Bogota), and Garden Inns and Hamptons elsewhere. “If we could add eight to ten of our full service brands each year for the next few years in Latin America, we would be pleased,” Turner adds, noting that they opened three noteworthy Westins this year in Latin America. they traded down a bit thanks to economic to jump in. The reasons for the investment uncertainty, allowing private equity and other investors

The St. Regis Shenzhen, with F&B outlets on the 95th floor.

boom,

according third

Jones

Lang Global

LaSalle’s

quarter

Market Perspective: “easing levels of liquidity, improved hotel trading performance, and banks’ actions to speed up workout programs.” In the EMEA region, $4.7 billion in hotel transactions took place, an 84 percent increase on the same period last year; activity accelerated as a result of a marked increase in the number of assets going into administration. In Asia Paciﬁc, deal volumes totaled $2.6

The lobby of the Westin Lima Hotel & Convention Center.

billion, a 59 percent year-on-year increase. Middle Eastern hotel investors

have stepped up and acquired assets totaling $1.7 billion in the ﬁrst half of 2011. “Oil prices have gone up the last year, and economies based on oil are ﬂushed with cash,” says Haast. And according to Jones Lang LaSalle’s bi-annual Hotel Investor Sentiment Survey, an increased 38.6 percent of investors worldwide indicated a ‘buy’ strategy for the next six months. The largest uptick in ‘buy’ sentiment was in Asia Paciﬁc, followed by the EMEA region. However, in the Americas, the same sentiment decreased slightly, but it still remains at the highest point of the three regions. “In the short-term, the markets that ranked highest for acquisition targets across the globe include Scandinavian cities Stockholm (66.7 percent) and Copenhagen (62.5 percent). Chicago, Milan, and San Francisco round out the top ﬁve cities,” says Haast.

Show Me the Money
“From 2010-2011, the investment side of the industry was very, very active,” says Haast. In fact, Jones Lang LaSalle forecasts that the global hotel investment volume came in at $34.8 billion for 2011, a 28 percent increase from 2010. Haast says that REITs were the most inquisitive

www.hospitalitydesign.com

December 2011

http://www.hospitalitydesign.com

Table of Contents for the Digital Edition of Hospitality Design - December 2011