(prensa.com) Three years ago, when news began to spread about the arrival of renowned international chains, hoteliers thought the next step would be a collapse in prices for rooms and a possible distortion in the market.
The hotels with more than 100 rooms have had a fruitful year in 2010, with an average occupancy of 74 percent up until October, and it is projected that tourist arrivals will grow by an estimated 5 percent in the coming years. As such, hoteliers and tourism operators agree that there is enough market for current and future hotels opening between 2011 and 2013.
It is estimated that the number of tourists by the end of the year will reach 1.7 million, which constitutes an increase of 200,000 people as compared to 2009.
Sara Pardo, President of the Panamanian Association of Hotels (APATEL) recognizes that the competition to attract new customers will be more intense with the arrival of international chains such as Hilton and Hyatt, but dismissed the notion that this will cause a saturation requiring hotels to reduce prices.
In order to maintain a high occupancy, Pardo said, we will have to increase the promotion of Panama abroad, and exploit new niches to maintain a steady flow of visitors.
For Fidel Reyes, manager of FR Consulting, an advisory firm providing services for the installation of eight new hotels in the country, of which four will be managed by the company, Panama should focus on the segment of congresses and conventions because it is a volume market, and that is precisely what hotels in the country need.
As a result of the promotion for the free use of the Atlapa Convention Center in 2011 and 2012, a total of 20 conferences with more than 1,000 attendees, are confirmed thus far, which is expected to generate an estimated 200,000 visitors, excluding the smaller events.
Lowering tariffs is the easy way out if the objective is to maintain a high occupancy, Reyes said, but in his opinion, the best tool for ensuring a steady flow of customers is to add more value for services charged to the guests.
Although four new hotels commenced operations this year, among them, the Riu and Finisterre, which together account for more than 700 rooms, their arrival did not represent any change in prices among hotels in the same category, such as the Sheraton, Miramar, Marriott, and Le Meridien.
At present, the price per night in a single room ranges from $170 to $190, while a suite runs between $200 and $250 per night.
But according to Carlos Córdoba, a sales manager of the Riu Hotel, the new hotels do not really compete with the older ones. The Riu hotel opened its doors in September and has had an occupancy rate of 50 percent, initially offering special rates, but now their prices are “linked to the quality of service offered on the market.”
Meanwhile, Jaime Campuzano, manager of the El Panama hotel, believes that the only way to attract more tourists to the country is to developed more tourism products, especially in the countryside.
If Panama fails to attract an increased number of tourists each year, then we will in fact have an oversupply of resort hotels, which will be forced to reduce their prices in order to maintain profit margins, he said.
According to Enrique Pesantez, manager of Pesantez Tours, rising operating costs have also stood in the way of hotels being able to reduce room prices.