“Latin America has a huge growth potential”

Michel Montant, Vice President Grupo Posadas Mexico.

Grupo Posadas is the largest Latin American hotel operator in the region; it is formed by over 111 hotels and 19.800 rooms in 50 beach and city destinations, sited in Mexico, Brazil, Argentina and Chile. Its Vice President in Mexico, Michel Montant, will participate in the parallel session focused on “Opportunities in the Latin American market”, within the second track of the HIWC.

What are the parallelisms between the Spanish and the Latin American markets in the hotel industry?

In particular, Mexico and some other countries from Central America and the Caribbean, the most significant parallelism is that, as the Spanish coast has become one of the main relaxing holiday destinations for those in the European market seeking sun and beaches, these countries are the main sun and beach destinations for the North American market. Although this is at its youngest stage of the process, due to the distrust among North American tourists to venture out of their country into these areas considered less safe. So, the potential is huge.

Also, the Latin American hotel markets are much less developed than those in the advanced countries, especially in Spain. In general terms, the level of quality hotel offer is still low, mainly because the demand hasn’t been there. However, the demand is growing quickly due to the economic development, the increase of middle class, decentralization of economy in different countries into the different regions. I reckon that today, there is a quality hotel offer (those affiliated to a chain or that have international standards) that equals one fifth of what is in Spain.

Undoubtedly, the country on the top of the development in hotel offer is Mexico, due to its closeness to the North American market, which provides it with a bigger tourist vocation (4 to 5 times more visitors than Brazil and Argentina).

Another similarity is that the type of hotel industry in the region is closer to the one in Spain (in Europe, in general) in terms of size and type of hotels (more efficient, reduced areas and more vertical), versus what can be found in North America.

What are the prospects for the future of the hotel industry in the area?

As I mentioned earlier, the future is very promising by looking at the development of the economy in the area, as well as a boost of internal demand from local travellers, both for business and leisure, as a consequence of that. Latin America is nowadays the region with best growth and stability prospects after Asia, and if we analyze the current hotel offer, we can estimate the existing potential to grow. There are many new poles of investment where there isn’t a quality hotel infrastructure.

What are the most interesting traits of the Latin American market for the hotel operators, especially for the Spanish ones?

Undoubtedly the affinity in language and culture, as well as the specialization of hotel operators in working efficiently and productively. There are already many Spanish operators, especially in Mexico and the Caribbean, although they have specialized in certain positioned leisure markets (Cancun, Mayan Riviera, Cuba, Dominican Republic, etc.). Some of them already have an important presence in urban destinations too (NH, Melià, RIU), and this is because of the comfort in being involved in an environment where language and culture is more accessible.