MIAMI— A global and U.S. economic revival should spur a Latin American recovery by the beginning of 2003, despite the fact that recent prospects for Latin Americas economies seem dubious. This is according to the latest Jones Lang LaSalle report, entitled “Focus On Latin America,” which provides a review of and outlook for the hotel investment markets of Argentina, Brazil, Chile and Mexico. According to JLL researchers that conducted the study, this will signify hotel investment opportunities for the region. “The forecast U.S. rebound, with expected growth of 1.6% in 2001 and close to 2.9% in 2002, should especially benefit countries exposed to the international business cycle, such as Mexico,” said Christian Charre, vp and head of JLL Hotels office here. “The global recovery should also coincide with the tightening of domestic policies slated to occur in most major Latin American markets. This will certainly help the region.” The report further noted that by 2002-2003, the Argentine and Brazilian governments will have tight domestic policies in place, bringing current account deficits well below the long-term flows. Plus, excess capital flows as they relate to current account deficits should ease international financial conditions and sustain a decline in interest rates, which should then spur domestic demand. “However, the recovery will likely be uneven across countries,” noted Gregory Rumpel, svp of JLL Hotels. But countries with a strong tourism industry, namely Argentina, Brazil and Mexico, should recover at a swifter pace,” he said, thereby making them ripe for hotel investment. New laws in Argentina should make hotels more competitive in that region, while Brazil is seeing hotel chains expand their brands via condo hotels— popular with European hotel chains— and by building properties with their own funds, according to the study. The report cites Chile as “one of the most dynamic and promising markets in Latin America, in part due to the transparency of its regulations and the predictability of its market decisions,” while Mexico was found to be “an investment-grade country with booming resort destinations and emerging secondary markets.”
