According to STR Global, the Caribbean and Mexico's total active hotel pipeline has more than doubled in the previous six months as investor interest returns. The research firm's active pipeline for June comprises 131 hotels with a total of 21,957 rooms, up from 50 hotels with 9,495 rooms in the region's active pipeline in December. investment in qatar
According to STR, just five hotels with 354 rooms opened in the region in 2012.
"Banks are gradually regaining confidence in financing on hotels," Jan Freitag, STR's senior vice president of strategic development, told WPC News. "There are a lot of people who are attempting to start projects, but they need money."
Projects in the construction, final planning, and planning stages make up the region's total active pipeline. According to STR, more than 10,000 hotel rooms are now under construction, with 4,025 rooms in Mexico.
The Dominican Republic (2,475 rooms), Bahamas (2,271 rooms), Puerto Rico (709 rooms), Aruba (320 rooms), and Jamaica (320 rooms) are the five other countries with more than 200 rooms under development (238 rooms).
"Bankers and owners are re-engaging in this area, and they [developers] believe the current existing properties aren't meeting the needs well enough, and they can earn money by delivering a better property," Mr. Freitag said WPC. "Every now and then, a local developer will say, 'Hey, I can make this work.'"
Luxury rooms account for 4,000 of the total rooms under construction in the Caribbean and Mexico. In the luxury sector, the region's pipeline contains nearly 7,000 rooms throughout all phases.
"We anticipate an increase in construction in 2014 and beyond since there will be greater interest and finance for new properties," Mr. Freitag added.
"When you suddenly have two or three more properties, that can undoubtedly effect the local competition," he said, adding that new construction will largely effect specific markets or submarkets.
The Caribbean is competing in a global market that is becoming increasingly competitive. According to a recent TravelSat analysis on the Caribbean, Caribbean destinations must assess their competitiveness in comparison to other worldwide locations.