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Panama: Central, South America Hotels Enjoy Revenue Growth in Q1

2012/05/17

Central, South America Hotels Enjoy Revenue Growth in Q1

Based on a new report, the majority of South and Central American cities tracked by STR Global continued to enjoy revenue-per-available-room (RevPAR) improvements for the first quarter 2012 compared to the same timeframe last year. Ten out of 14 cities tracked across Central/South America reported RevPAR improvements driven by increases in average daily rates (ADR).

Panama City; Lima, Peru; Manaus, Brazil; and Bogota, Colombia, reported RevPAR declines in local currency for the first quarter, dropping between 11.1 percent in Panama City and 16.2 percent in Bogota. Panama City and Bogota saw the highest supply increase of the 14 cities with 16.1 percent and 10.9 percent, respectively. The additional hotel supply reflects the booming investment and confidence in these markets. Higher demand growth in Panama City helped to offset some new supply in the market, and hence, Panama City reported lower occupancy and ADR declines than Bogota, as shown in the table below.

Quarter One 2012 percentage change in local currency

Rio de Janeiro and Cordoba, Argentina, ended the first quarter with RevPAR increases of more than 20 percent, achieving the top two spots in terms of RevPAR growth of the 14 markets. Cordoba, Argentina's second largest city, reported very limited increases in supply and demand, leading to 57.8 percent occupancy and ARS 382.91 average room rate. Rio de Janeiro's performance was boosted by better demand levels (+6.1 percent) compared to first quarter 2011. Coupled with limited supply, occupancy reached 81.5 percent and ADR reached BRL 418.73. Rio's RevPAR for the first quarter (BRL 341.19) was the best RevPAR achieved for a first quarter in Rio since 2006.

"The RevPAR increases across most markets reflect the solid market conditions across Central and South America", said Elizabeth Randall, managing director of STR Global. "However, recent weakening of demand in seven of the 14 markets can be seen as an indication that there will be tougher market conditions going forward".

Quarter One 2012 percentage change RevPAR (local currency), Demand

STR Global tracks performance data from over 92,000 hotel rooms across Central and South America. STR Global will be presenting on regional trends at the Hotel Opportunities Latin America conference, taking place in Miami 8-10 May 2012.

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