Over the past two decades, Latin American countries have achieved a level of political and economic stability to justify the
conviction that their moment on the global stage has arrived.

Its expanding middle class, new discoveries in oil and gas, infrastructure investment and economic growth driven by commodityled exports have contributed to a general consensus that a gold rush of opportunity will ensue over the next 10 years. The main countries of Latin America have arrived at an inflection point: they are poised to experience the type of rapid, domestically-driven economic growth experienced by the United States in the 1950s and 1960s.

Consider some of the landmark infrastructure and development in U.S. history, for example, how the development of the Hoover Dam created cheaper electricity, making air conditioning in the desert possible – along with new opportunities for Las Vegas. In Orlando, the creation of Interstate 4 and the existence of the McCoy Air Force base and other defense industry installations were among the factors that led Walt Disney to choose Central Florida for Disney World in 1962.

Also, recall the economies of Dallas and Houston, and the impact the 1973 oil embargo and jump in the price of oil had, giving rise to extraordinary growth that fueled massive investment in DFW and IAH airports and local transport infrastructure.

Similarly, key infrastructure developments are happening throughout Latin America today. The world's largest iron mine is expected to create some 30,000 new jobs in Parauapebas, Brazil, a town that would not have even shown up on the radar 10 years ago.

Moreover, Yopal, Colombia has emerged as an important staging area for recently discovered oil fields. The $4 billion Bicentenario pipeline will connect Yopal to the Caribbean at Puerto Conveñas by 2015, boosting economic activity and lodging demand in both locales. Mexico is building a new highway that will directly link Durango with the port of Mazatlán, dramatically decreasing the travel time from eight hours to just three and impacting commercial and leisure lodging
demand in both cities.

And as Peru's backlog of announced gold, copper and other mining activity approaches $50 billion, a variety of complementary road and maritime infrastructure projects will follow suit, including a $600 million investment in the Almirante Miguel Grau Port facility.

There are hundreds more projects and developments in these countries and throughout the region. And for the travel and leisure industries, this means big business. Lodging occupancy in many of these cities is already at a maximum, with rooms taken up by workers and executives on infrastructure projects. And as each project comes closer to completion, demand grows.

Investors, developers and hotel companies alike perceive that the development of select and limited-service product in rapidly growing markets outside the gateway cities represent one the most attractive growth opportunities in the sector. However, the general lack of specificity substantiating the ‘what, when, where, and why' of the opportunity has caused hesitation as to significant forward movement.

Leveraging financial support from key industry sponsors, Wyndham Hotel Group, DLA Piper, LP, RCI, Inc., and VOA Associates Incorporated, along with data and research from more than 15 additional partners, Jones Lang LaSalle conducted a top-down and bottom-up analysis, converging macro and micro data points to assess the markets' real opportunities over the next 10 years.

The primary goal of this paper was to assess the overall development potential for the lodging and vacation ownership markets in selected Latin American countries, particularly in rapidly emerging secondary and tertiary markets.



As Brazil, Colombia, Mexico and Peru combined account for nearly 70.0% of the total population in Latin America (excluding the Caribbean) and approximately 75.0% of the region's GDP, our research zeroes in on these four countries over the 10-year forecast horizon through 2022.

We examine trends in key factors that drive economic transformation toward services-oriented economic activities, which have been shown to be the biggest generators of lodging demand, as well as in specific investments in order to estimate the types of projects and market types that will be most directly affected.

Substantiation of new lodging development opportunities is generated by these macro and microeconomic factors and is expressed by changes in the hotel supply ratio (HSR) – the number of hotel rooms per 1,000 inhabitants – at the country and market level.

Our countries of focus have now reached the inflection point of 60.0% services-oriented economic activity, the threshold where the United States and United Kingdom. have exhibited accelerated growth in lodging demand and supply.

The markets are thus poised for major growth. In total, we project the gross room supply growth for these four countries at 425,900 rooms, representing a compound annual growth rate of 5.2% and an absolute percentage increase of more than 65.0% over a 10-year period. The countries' aggregate HSR is currently 1.6 and is projected to increase to 2.5 by 2022.

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