Update: Resort Development In Mexico
MORE LUXURY, MORE ALL-INCLUSIVES
Mexico’s resort segment is evolving, expanding into new
areas as it moves toward a generally more upscale model.
“We have seen an increase in luxury brands in the last
couple of years,” said Luigi Major, vice president of hospi-
tality and valuation services for the HVS accommodation
consultancy, Dallas. “We have seen a couple of Capella’s,
several Banyan Trees, St. Regis, Four Seasons and others.”
He believes that Mexico’s accommodation industry is
poised to resume development as economic conditions
improve. “A lot of projects are in the planning stages and still
on hold,” Major said. “The recession drove down rates and
occupancies, which made new projects less feasible. Now
existing properties are beginning to recover and once they
feel on more solid footing, development can get going again.”
Meanwhile, many resorts have been investing in renova-
tions while waiting out the economic downturn. “If you’re
operating under a brand banner, you have to maintain
standards,” Major noted.
Branding is at the heart of the Palace Resorts’ strategy
to convert three of its Mexico properties to Hard Rock all-inclusive resorts.
“We feel that branding is extremely important to the destination,” said Frank Maduro, vice president of marketing.
“Hard Rock has 83% brand recognition around the world.
Many young travelers will go to an all-inclusive for the first
time because of the Hard Rock name. In Mexico, there is an
abundance of all-inclusives so there is a need to differentiate. The Hard Rock name will enable us to stand out, and
it’s good news for the destination.”
New Resort Areas
Major anticipates that new resort destinations will be developed in Mexico as land becomes more scarce in Cancun,
Puerto Vallarta and other key resort areas.
“The strongest location is Cancun/Riviera Maya where
a lot of land is already taken, but there is much potential
growth in adjoining areas,” he said. “There are rumors
about a new international airport in Tulum which would
drive development in a whole new area.”
The Puerto Vallarta corridor is also very developed, “but
if you go north there is newer development at Punta Mita.
Similarly, in Cabo people are looking north along the Sea
of Cortez. The same is true for other locations. So there is
definitely room for growth, if not in the established areas,
then in neighboring ones.”
For travel agents, new resort areas, new properties and
an expansion of luxury brands and amenities are all positive
trends. “There is more product to sell, from small and cozy
resorts to large sophisticated properties with amenities like
iPod docking stations,” Major said. “There is more segmen-
tation within the resort product, and that’s good for agents
with a variety of clients.”
“THERE IS MORE PRODUCT TO SELL, FROM SMALL AND COZY RESORTS TO LARGE SOPHISTICATED PROPERTIES WITH AMENITIES LIKE IPOD DOCKING STATIONS.” — LUIGI MAJOR, HVS CONSULTANCY [ ]
RENDERING OF THE LOBBY, HARD ROCK
BELOW: RENDERING OF THE HILTON
PUERTO VALLAR TA ALL-INCLUSIVE
Amenities will include an outdoor pool with two sections, a
kids’ club, a spa, and three restaurants.
Hilton’s new all inclusive is part of a broader expansion
of the brand throughout Mexico, said George Massa, vice
president and managing director of development in Mexico
for Hilton Worldwide. New properties are planned for destinations ranging from Mexico City to Puerto Vallarta, Los
Cabos, Guadalajara, Merida, Saltillo and Ciudad del
Carmen. By 2015 the company anticipates a presence
of more than 60 properties in Mexico, Massa said.
More All-Inclusives Coming
Despite economic conditions, a number of brands are
expanding their resort portfolios in Mexico.
Hilton Hotels & Resorts is scheduled to open its first
all-inclusive resort in Mexico this summer, in Puerto Vallarta.
The 259-room property will consist of new construction and
a converted structure, according to Bonnie Campagnuolo,
Hilton’s senior director of resorts and product marketing.
Brands Expand In Mexico
There are no plans on the drawing boards yet, but Starwood is considering establishing all-inclusives in Mexico.
“We’re being more flexible in our approach to resorts,
especially as far as all-inclusive options,” commented
Ricardo Suarez, Starwood’s vice president of acquisitions
and development. “Our eyes are on Mexico where we want
to explore the concept because it is a segment where we
have seen a lot of growth.
“We do offer all-inclusive packages at our properties as
an option,” Suarez added. “But there is more and more
acceptance of all-inclusive resorts and you’ll see us being
more active in that space. Sheraton is the strongest resort
brand in the world and we see potential for growth of that
brand in Mexico.”
Other brands are expanding their resort portfolios in
Mexico as well.
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