STR Sees Continued Growth in South America

According to data compiled by STR Global, year-on-year RevPAR in South America for year-to-date August 2011 has increased by 26.8% to US$95, mainly due to increases in ADR which is up 21% to US$143.

STR Global recently launched market reports for Lima, Caracas, Montevideo and Quito.

All the markets covered by STR reported double-digit percentage increases in RevPAR for year-to-date August 2011 compared with the same period the previous year.

Whilst Rio de Janeiro has the highest ADR in the region (US$206.14), Sao Paulo shows the greatest increase in ADR of 31.3%. All markets, except Caracas, recorded increased occupancy and Rio leads the way with actual occupancy of 74.6%.

Even amongst markets with low increases in occupancy, such as Quito (2.1%), Buenos Aires (2.3%) and Caracas (5.1% decrease), hoteliers have still managed to increase ADR to record more than respectable improvements in RevPAR.

Hotel demand in South America continues to be strong. In 2010, demand increased by 11.2% over the previous year and for the eight months this year it is up a further 6.7% over YTD 2010. Coupled with relatively low current increases in supply of no more than 2%, the increase in demand has translated into occupancy and rate growth each month since December 2009.

The hosting of the 2014 FIFA World Cup and 2016 Olympics secures a strong development focus in Brazil with 11,612 rooms across the three pipeline phases, according to the STR Global Pipeline Report, which shows hotels in construction, planning and final planning in the region. Other significant development is under way in Colombia with 2,312 rooms in the pipeline and Argentina with 1,777 rooms.

"The double-digit growth in year-on-year RevPAR in the major South American markets indicates a steady improvement of general trading conditions since the 2009 recession," said Elizabeth Randall, managing director of STR Global. "The opportunities for growth in Brazil with the two major sporting events coming up are reflected in the pipeline there."

See recent travel news from: Travel News Asia, STR, August 2011