Hilton Looks to Expand in Brazil Spurred by Collapse in Realby
Cooling building industry seen as opportunity for expansion
Only two of company's 70 Latin American hotels are in Brazil
Hilton Worldwide Holdings Inc. plans to expand “quickly” in Brazil as the slumping real and lower costs present opportunities for the construction of new hotels and tie-ups with local operators, a company official said.
Brazil, a country of 200 million, is currently home to just two of Hilton’s 70 hotels in Latin America, said Eduardo Rodriguez, director of development for Brazil and the Southern Cone.
“Dollar volatility provides us with good opportunities,” Rodriguez said in the interview in Lima. “We want to grow quickly. We’ve been in Brazil for many years, but this is an interesting scenario for us.”
Hilton may be at the forefront of a wave of companies looking to take advantage of the real’s slump against the dollar to invest in Latin America’s biggest economy. The currency has plummeted 41 percent in the past year and touched its weakest level since 1994 last week.
While Brazil’s hosting of soccer’s 2014 World Cup spurred construction of new hotels, slowing economic growth has dimmed the outlook for tourism and local operators are looking to tie up with international brands such as Hilton, Rodriguez said.
Hilton plans to add 40 hotels outside Brazil in Latin America by the end of 2017, said Tom Potter, senior vice president for the company’s operations in the region, in the interview in Lima. Both Potter and Rodriguez declined to give details about talks underway in Brazil.
“A lot of the real estate development in last 10 years was dedicated to residential, malls and offices,” Potter said. “The office market in Brazil is not as strong as it was, so there are opportunities for hotel development,” he added.