With the International Hotel Investment Forum (IHIF) just around the corner, I contacted a few colleagues speaking at the IHIF to discuss some of the challenges and opportunities they face in 2012.
They all agreed that the Middle East and Europe face challenging times ahead through either political instability or financial chaos. Nevertheless, tourism is a resilient industry and according to Marriott International’s Ed Fuller: “It is a mistake to view either region as a monolithic block of countries as each country has differing realities and challenges”.
“The Middle East, despite its challenges, remains second only to Asia as the fastest-growing tourism zone in the world. While a few developers are temporarily taking a “wait-and-see” posture, conditions are improving in areas like Tunisia and Morocco and the United Arab Emirates reports the region’s largest pipeline of rooms with 21,238 rooms now under construction. Development also remains strong in Saudi Arabia, Qatar, Egypt and Jordan,” reports Fuller.
Over in Europe, the industry is expected to grow 2-3% in 2012 with nearly 300 hotels or 50,000 rooms expected to open this year.
Chris Day, managing airector, Christie + Co says: “Hotels in Europe on the whole remained both solid businesses and sound investments in 2011. As 2012 takes shape, prospects remain fairly optimistic though funding continues to be the elephant in the room”.
Of the key European markets, Germany seems largely unaffected by the financial stresses but Ed Fuller comments: “The southern European countries can be expected to take advantage of the political situation along Africa’s northern coast by promoting their destinations as low-cost, safe alternatives.”
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