Hotel Occupancy, But Not Rate, Up In Central, South America

Occupancy is beginning to rebound in key Central and South America cities, though rate largely has yet to follow suit, according to data released today by Smith Travel Research Global.

Seven reviewed cities—Buenos Aires; Mexico City; Panama City; Rio de Janeiro, Brazil; San Jose, Costa Rica; Santiago, Chile; and Sao Paulo, Brazil—all saw year-over-year demand growth in the first two months of this year, the data indicated. While Rio de Janeiro saw demand growth consistently throughout 2009, the other cities have seen a pickup only in the past two to four months.

"We are predicting a year of recovery rather than growth," according to STR Global managing director Elizabeth Randall, who also noted that Brazil in particular seems poised for growth due to its hosting of the World Cup in 2014 and the Summer Olympics in 2016.

The demand uptick translated to an occupancy boost except in Panama City and San Jose, where occupancy dipped slightly in the first two months of 2010. Both cities also had significant supply growth during those months, according to STR global.

Most cities continued to see year-over-year rate decreases in terms of U.S. dollars during January and February, according to the data. Rio de Janeiro and Sao Paulo were the exceptions, seeing rate increase of 17 percent and 28 percent, respectively. The strengthening of the Brazilian real against the dollar played a large role in that, STR Global said.