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21 August 2012 | Anna Reynolds
Cities across Latin America have seen the strongest growth in hotel rates in the first half of 2012, according to a survey by Hogg Robinson Group (HRG).
Leading the way is Mexico City, with a 20 per cent increase in room rates. As a major economic hub in the region, the world’s fifth largest city has experienced a surge in business travel, which has put pressure on existing availability. Additional capacity is only expected to increase by 4-5 per cent over the next three years, further driving up rates.
In the survey of the world’s top 50 cities, São Paulo, Brazil saw rates jump by 10 per cent due to the region’s expanding financial sector, with business travel outpacing new hotel openings. Meanwhile, the UN Earth Summit held in Rio De Janeiro in June contributed to increased demand and rates in the city rose by 4 per cent.
Stewart Harvey, group commercial director of HRG, said: “The results present an intriguing picture of where businesses are channelling travel spend. Macroeconomic weakness and uncertainty are driving room rates down across mainland Europe, but the significant growth in room rates across the Latin American region indicates a shift in business priorities towards high potential destinations.
“Businesses are not necessarily spending less on travel, but they are certainly looking for ways to make existing budgets work harder."
The study also found hotel prices across the Eurozone either fell or remained flat, as a consequence of the ongoing financial crisis.
But overall the international hotel market does appear to be stabilising, showing a 1 per cent variance in price fluctuations across the top 50 cities, compared to 4 per cent last year.
Across the 12 UK cities surveyed, London, Liverpool and Belfast reported the strongest growth.