Investors plan US$ 1 billion in hotels by 2012
Valor Econômico
A group of 30 foreign investors, mainly Americans and Europeans, intends to invest US$ 1 billion in hotels in Brazil in the next two years. That is the estimate of the American Ernst & Young, which made a survey, to be released today, with investment funds and banks, besides contractors. "Except for Mexico, Brazil has the largest volume of potential opportunities. And the recovery of the hotel sector in Brazil is strong", says the partner of Ernst & Young in Miami, the Brazilian Rogério Basso. According to him, between 70 and 80 companies were interviewed in total. All with operation in the real estate sector.
Nearly 60% of those interested in investing in Brazil, says the consultant, intend to join local partners. "To enter Brazil they need to associate to someone with availability of land and local knowledge of the legislation". says Basso. The number of investors who want to stay in the country for more than six years reaches 60% of the investors heard. They are projects that go beyond the 2014 FIFA World Cup and the 2016 Olympics. But "there are many opportunistic funds that want to quickly enter the Brazilian market just because of the Cup and the Olympics" as well, says the consultant, who has been at Ernst & Young in Miami for 11 years.
Basso says the potential investors are planning to invest both in the construction of new hotels and in the acquisition of undertakings in operation. According to him, most prefer luxury hotels, with more attractive rates of return than the economic brands. "To be able to execute a strategy like that (investing in economic hotels) you must have scale, you must find a partner able to get 20 to 30 hotels in five years", says Basso.
The study made by the consulting firm mapped the difficulties foreign investors see in the Brazilian market. They are obstacles such as taxation and labor law, among others. "The investors request a great effort in infrastructure works. And that not only in airports or highways. They also show concern with the lack of skilled workers and equipment such as elevators", says Basso.