Emphasizing Latin American's growth potential as one of the world's fastest growing hotel and travel markets, Starwood's CEO Frits van Paasschen and members of the company's senior executive team visited Latin America last week, traveling to key growth markets, including Brazil and Colombia.
"Macro-economic trends continue to reshape the Latin American travel and business landscape, creating strong growth in lodging demand and many opportunities for Starwood to expand in the region," said Frits van Paasschen, President and CEO, Starwood Hotels & Resorts. "At the same time, Latin America's middle class grew by 50 percent in the last decade and this increase in wealth means that there are more and more people with the means to travel and an increasing appetite for global, luxury brands like ours."
As the first international hotel company in Latin America dating back to the opening of the Sheraton Maria Isabel in Mexico City in 1963, Starwood today is the largest high end hotel operator in the region with 72 hotels in 13 countries and a total of 15,600 rooms. Since 2007, the company has grown by 36% in Latin America.
In the last two years the company opened 13 hotels, including its debut in Costa Rica with Westin Playa Conchal, Starwood's first all-inclusive hotel in the world, the recent opening of Sheraton da Bahia Hotel in Salvador, Brazil, and the opening of new flagships including W Santiago, The Westin Lima Hotel & Convention Center, St. Regis Mexico City and Sheraton Bijao in Panama- the first Sheraton branded all-inclusive hotel in the world. Additional recent openings include The Westin Playa Bonita Resort & Spa Panama, The Westin Panama, The Westin Guadalajara and The Westin Santa Fe in Mexico; Aloft Bogota Airport and Aloft San Jose Hotel; Villarrica Park Lake Hotel, a Luxury Collection Hotel; Le Méridien Mexico City; and Four Points by Sheraton Mexico City, Colonia Roma.
Starwood has a pipeline of 19 hotels with a total of 3,200 new rooms in development. In the remainder of 2013, Starwood expects to open six more hotels with a total of 1,100 rooms, covering four brands across four countries.
"Latin America is emblematic of the growth we are seeing in regions around the world and key to our development plans," said Simon Turner, President of Global Development & Acquisition, Starwood Hotels & Resorts. "There is strong affinity for all of our brands in the region across the luxury, upper upscale and mid-market segments, and we're looking to build on this interest with new world-class hotels in the right places, with the right partners."
"We are optimistic about the future of our company in Latin America because we have various competitive advantages, including a long-established presence for more than 40 years, local know-how and strong relationships driven by our in-market teams," said Osvaldo Librizzi, co-president of Starwood Hotels and Resorts Americas. "Combined with our world-renowned lifestyle brands, we are well-positioned to grow and maintain our lead in the market."
With more than 80% of the world's economic growth coming from fast-growing markets over the next few years, Brazil is a key focus for the company. Underscoring the importance of the country, van Paasschen and members of Starwood's senior executive team met with hotel owners, customers and investors in Rio de Janeiro, Sao Paulo, Recife, and Salvador to evaluate new projects. They also visited the iconic Sheraton Rio Hotel & Resort in Rio de Janeiro, one of Starwood's most valuable owned-assets in the region. In 2012, the hotel began a multi-million dollar renovation project that is part of Sheraton Hotels & Resorts' ongoing commitment to enhance its global portfolio and reflects Starwood's unwavering commitment to Brazil. Renovations are expected to be complete by the second quarter of next year.
"There is significant opportunity for hotel development in Brazil due to its sheer size, natural beauty, and relative under penetration, particularly at the high end. We want to bring our skills and expertise at operating high-quality branded hotels to this dynamic market, and believe rising rates and occupancies, and clear pent up demand for travel, make this a promising time to pursue growth opportunities," added van Paasschen.
Starwood currently has eight hotels in some of the most important cities in the country, including Sheraton Rio Hotel & Resort and Sheraton Barra Hotel & Suites in Rio de Janeiro; Sheraton Vitoria Hotel; Sheraton São Paulo WTC, Sheraton Porto Alegre Hotel, Four Points by Sheraton Curitiba, Four Points by Sheraton Macaé and the Sheraton da Bahia Hotel in Salvador, which is celebrating its recent inauguration today. Sheraton Reserva do Paiva Hotel & Convention Center near Recife is scheduled to open in the first quarter of 2014.
Starwood executives also spent time in Colombia meeting with owners and partners and visiting the site of the future W Bogota, which will mark the brand's entry into the country. In the past years, Colombia has made important steps in enhancing its economy and hotel infrastructure, becoming an attractive destination for foreign investment and international hotel brands. Starwood has been present in Colombia for almost 20 years, and today, the company has several exciting projects in the pipeline, including Four Points by Sheraton Bogota, Sheraton Cartagena Hotel, and W Bogota- all slated to open in 2014.
"We believe that Colombia is a country ripe with opportunities for growth and we plan to expand our brands in the major cities and secondary markets in the years to come with development partners who have a proven track record of success and are looking for a new and exciting growth vehicle," van Paasschen concluded.
Starwood currently has four hotels in Colombia, including Sheraton Bogota Hotel, Four Points by Sheraton Medellin, Four Points by Sheraton Cali and Aloft Bogotá Airport.