Hoteliers in Mexico adapt to business travel trends
Hoteliers in Mexico adapt to business travel trends
07 MARCH 2019 9:22 AM

Hoteliers speaking at the 2019 Mexico Hotel & Tourism Investment Conference shared insights into how things are shaping up for business hotels in the country.

Editor’s note: Quotes in this story were derived from a Mexico Hotel & Tourism Investment Conference panel that was conducted in Spanish and translated by event staffers in real time at the event.

MEXICO CITY—Business travel is an incredibly important demand driver in markets across Mexico, according to experts speaking at the 2019 Mexico Hotel & Tourism Investment Conference.

During a panel titled “Drilling down on supply and demand—business travel,” Germán Ongay, regional VP of franchise sales and development in Mexico for InterContinental Hotels Group, said the bumpy transition to a new government and economic issues in the country have raised some “red flags,” but the business hotel segment in the country overall continues to exhibit strength.

“Basically all the brands have been moving (into Mexico) without exception,” he said. “On top of that, one of the best ways to protect your money is in real estate. Nothing else can shield you away from unforeseen circumstances.”

Extended stay increasingly important
Several companies are looking to grow their presence in the extended-stay segment in Mexico, panelists said.

Antonio Patjane, expansion and development director for Mexico City-based Extended Suites, said the fundamentals of the segment have not changed as more players enter the field. He said the demand for extended stay properties is diverse and resilient.

“It turns out there are many markets that can be serviced,” he said. “There are medical long stays, sports long stays, European long stays, all types. Things are very green in that aspect.”

Mexico has dual-brand opportunities
At the same time, there’s a growing interest in Mexico for international brands to build out dual-brand properties. Louis Alicea, senior director of development in the Latin America & Caribbean for Wyndham Hotels & Resorts, said his company is particularly keen on a dual-brand concept pairing Wyndham Grand with the new Wyndham Residences to target traveling executives.

He said those sorts of dual properties can keep down costs while providing a high level of service.

Executives “need something for themselves and their families in a luxurious environment that at the same time has hotel services—things like dry cleaning, room service and restaurants,” he said. “That’s something we see (demand for) here in Mexico City.”

Alfredo Reynoso, director of development for Hyatt Hotels Corporation, said there are opportunities in the country to pair its select-service Hyatt House and Hyatt Place brands because they can draw “different types of customers” while sharing operational efficiencies.

“In some markets, we can perfectly coexist with these two products and create economies of scale in operations,” he said.

Business travelers are looking for innovation
Modern travelers don’t want a cookie-cutter experience even if they’re traveling for work, panelists said.

Reynoso said travelers, specifically millennials, are “increasingly adaptable to different technologies,” and brands have to work to integrate tech to improve their stays. At the same time, companies like his have to show an ROI on tech investments.

“It’s about how you make technology a driver of income, make it a facilitator of service and, at the end of the day, guests’ comfort.”

Gerardo Valdés, director of development in Mexico for Radisson Hotel Group, said travelers in Mexico are increasingly looking for ease of booking and customization.

“If you use your app to give you tools to know about him or her, then you have a level of customization you didn’t have before,” he said. “That’s an advantage we’re working on.”

Still room to grow
Panelists said there are some markets that are misunderstood or “overbuilt,” but Patjane cautioned investment in Mexico should be “a marathon” and not a sprint.

“We’re here to stay long term, operating hotels 10 or 15 years from now,” he said. So some projects “if we don’t do them now, we’re missing out.”

Ongay said there are some markets people can consider at capacity for new supply, but the country’s biggest cities are remarkably resilient.

“The cities can immediately absorb rooms and before year’s end are already back up” to normal performance, he said.

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