In 2008 new resort development activity plummeted. Resort developers stopped commissioning market studies and feasibility studies throughout 2011 and 2012. Investors’ focus was on acquiring operating resorts and staying focused on proven mature destinations that worked. Construction costs were higher than available inventory already in the market.
In our experience as hotel consultants, 2013 was a turning point. I think hotel consulting companies’ advisory activity is a good barometer for detecting changing trends, and in 2013 and 2014 we have been experiencing a surge in feasibility study requests for leisure destinations. Investors are now considering new developments. Construction-cost levels are making sense again. The appetite for risk is also shifting towards locations that involve creating a new destination from scratch. Developers are gradually considering less obvious destinations for newly built projects — Brazil’s northeast, Spain, Baja California, etc.
Are resort new developments picking up in your region as well?
What about financing?