Hilton sees LatAm as prime region

Hilton officials know there is pent up demand for extended-stay hotels in Latin America, so much demand in fact that some guests are treating brands with Hilton or Hampton Inn flags as extended stay.

Hilton sees this as a bright, flashing sign that the region is prime soil for growing its Homewood Suites by Hilton brand, executives said.

“We’re trying to narrow the scope of what we’re offering in each of the brands so people (in Latin America) have brand awareness,” Juan Corvinos, VP of development in Latin America and the Caribbean for Hilton, said.

He noted the goal of growing an extended-stay brand in the region isn’t to discourage guests from visiting Hilton’s existing brands in the region but to “give them the real product they can use for that stay.”

Adrian Kurre, global head of Homewood Suites and Home2 Suites by Hilton, said the brand will be critical for Hilton to carve out a spot as the extended-stay leader in Latin America.

“The main reason there’s a return on investment with Homewood is the extended-stay nature of it,” he said. “It is one of the most difficult things to do in the hotel business, which is finding extended-stay business.”

The brand saw a major milestone recently with the opening of the first property using the new Latin American prototype, the Homewood Suites by Hilton Silao Airport. That hotel is the second Homewood Suites property in Mexico. It is owned by Edco Turismo Bajío and managed by Hilton.

Corvinos said many more Homewood properties are poised to open soon. He added that the company first unveiled the new prototype in May 2016, and there has been significant developer interest since then. He believes that interest will only accelerate now that a property is open that potential owners can visit and observe.

The second property—scheduled to open by mid-year in Monterrey, Mexico—is dual-branded, featuring both Homewood Suites and Hampton Inn by Hilton flags.

Hilton officials said they are particularly hopeful about the potential of that dual-branded pair in Latin America.

In all, there are eight more properties currently in the pipeline, four of which are in Mexico. Corvinos said four more properties are expected to open by the end of 2019.

He said the types of travel seen in those countries make them especially ripe for extended-stay product.

“When you think about the type of travel to Chile (or) Argentina, no one goes down there for two days,” Corvinos said. “When you need to trek down there, you stay for at least five days.”

He noted that despite the high level of developer interest, openings might not be coming at a blistering pace compared to some U.S. brand launches. He said that comes down to regional differences.

“From a development standpoint, in Latin America everything takes a little longer than it does in the U.S.,” he said. “It’s not as mass producing as the U.S. But once you get traction—we figured it out with Hampton, we figured it out with Hilton Garden Inn—once it gets rolling, it’s going to get steam-rolling, and it’s really going to accelerate.”

Corvinos noted the company is seeing a number of its brands grow in Latin America, which will ultimately increase the power of the overall Hilton system in the region and globally.

“Homewood by itself won’t survive in Latin America,” Kurre said. “It needs Hiltons. It needs Hilton Garden Inns. It needs Hamptons. It needs the breadth of product, and critical mass of all of those products will help Honors members and the entire process.”

The company currently has 137 properties in Latin America with 80 more in the pipeline. Corvinos said the company has “over 65 ongoing conversations in Latin America” in relation to potential Homewood Suites projects.

He said Hilton overall approved 35 hotels for the region, eight of which will carry Homewood Suites flags.