Parks Hospitality takes U.S. business to the bank

Charles El Mann Fasja, CEO of Mexico City-based Parks Hospitality Holdings, says he will continue to capitalize on the “wallets” of the U.S. leisure traveler, the biggest source of business for his resorts in Mexico.

“All the leisure and resort segments are performing wonderfully. It’s incredible. We opened the Hilton Cancun in November last year. It was amazing that we had such good timing. All our resorts are packed with people,” Fasja said. “Some of the segments for business travelers are much slower. But all the leisure destinations and resorts are incredible.”

Parks Hospitality’s Conrad in Tulum, Mexico

Fasja told HOTELS in July that there are many reasons for this, and they all point to changes in the marketplace because of COVID. First there’s pent-up demand for travel following long-term isolation. In addition, leisure travelers want to go to places that are accessible. This makes the top resort areas in Mexico, such as Cancun on the east coast and Puerto Vallarta on the west coast, ideal for this sort of tourism. Travel to these destinations and others in the country, while foreign and exotic, is relatively quick and easy to fly into (even in this dreadful airline environment).

In addition to those reasons, throughout the pandemic the Mexican government kept its borders open and did not impose travel restrictions. Cancun particularly benefits by having the number two hub for international arrivals in Mexico. Cancun International Airport receives 1,219 international flights per week, of which 812 come from the United States, according to Airports Council International.

Parks Hospitality is well positioned to take advantage of these travel trends. The business was founded 20 years ago as a division of Parks Holdings, a development company with projects that span corporate, retail, industrial and residential segments. To date, Parks Hospitality has 32 properties totaling 12,000 rooms in Mexico and the U.S. and offers services from land acquisition to development.

This development experience is perhaps why Parks Hospitality is the official partner of Hilton Hotels & Resorts in Mexico. Together they developed approximately 15 hotels in Mexico, giving the multinational company a foothold in one of the few places in the world where it didn’t have a strong presence.

The relationship between the two companies is “like a marriage,” Fasja said. “It was a huge win-win because they needed a product, and we needed a brand to help us fill rooms.”

“There’s a lot of cash looking for investment in resorts in Mexico,” he said. “So, we are thinking about structuring a platform to raise institutional capital in the U.S. There is no platform right now that just specializes in leisure.” – Charles El Mann Fasja

Parks has similar arrangements with other large hotel brands, including Hyatt Hotels Corp. and Grupo Posadas. Its properties in Mexico include Hilton Vallarta Riviera, Hilton Tulum, Conrad Tulum, Canopy Cancun, Hilton Mexico City Reforma, Hilton Mexico City Santa Fe, Hilton Guadalajara Midtown and Hilton Monterrey GVO. It will soon open the Waldorf Astoria Cancun.

Fasja said every new and developing project is funded privately and the company is looking at new ways to attract funding from the U.S. “There’s a lot of cash looking for investment in resorts in Mexico,” he said. “So, we are thinking about structuring a platform to raise institutional capital in the U.S. There is no platform right now that just specializes in leisure.”

Fasja said the company benefited throughout the pandemic through its practice of local sourcing of materials to build and furnish its hotels. While companies struggled with supply chains, Parks was able to keep on building its properties.

“We started a project years ago developing local supply sources in Mexico,” he said. “Maybe 90% of our hotels are made in Mexico. That’s why we were able to open hotels during the pandemic while others had shipping problems.”

Despite all this growth, there are still challenges. The most difficult, according to Fasja, is dealing with the government.

“Mexico’s biggest challenge is the political entitlements process. It takes too long to get a site approved and we want to speed it up as much as we can,” he said. “Entitlements and authorization are the most complicated part of development right now.”

But for now, he says the resort and hospitality business will keep Parks Hospitality busy. “We’re bullish on the growth leisure segment not so much with business hotels,” he said. “Leisure will grow exponentially.”

He pointed to the fact that nature of the leisure traveler to Cancun has changed as well. Once known as destination for spring break, it has since changed its perception as a resort destination for those looking for upscale experiences.

“Cancun is becoming one of the most important luxury markets,” he said. “It wasn’t that way 10 years ago. Mindset of traveler is changing post pandemic. The behavior is changing.”