Hospitality Design - January/February 2012 - 72

Clockwise from above: Renderings of the VOA Associates-designed South American prototypes for Hilton’s Hampton and Garden Inn brands: the Hampton guestroom, and Garden Inn’s coffee bar and lobby entrance.

Paulo, created an oversupply in the market and ultimately, hurt investor conﬁdence. “Hotels aren’t seen as a massive craft for investment,” she says. At the same time, not only is there limited land, but ﬁnding existing buildings for conversions isn’t an easy feat—some have multiple owners who need to be bought out and many would be too pricey to bring up to brand standards, especially in terms of life safety requirements. “Execution of projects is the hardest part of developing in Brazil. We take a lot of care in choosing the developers we work with who have strong historical results managing these processes. Permitting and licensing is challenging in Brazil as well,” says Michael Teich, managing director of New York-based Avenida Capital, a Latin America-focused real estate investment and asset management ﬁrm. “In fact, compared to some of the other Latin American markets we invest in, it takes much longer to get these in place in Brazil.” Roadblocks are apparent on the design side as well. “The biggest challenge in Brazil is maintaining design integrity and the brand’s criteria,” notes Mark Pratt, senior vice president of Chicago-based VOA Associates, which has had an ofﬁce in São Paulo for more than 17 years. “There is a major problem with importing FF&E products and goods, making it extremely difﬁcult to source quality contract pieces for the hotels albeit we have helped several hospitality vendors set up shops to help provide these products and services.” Where hotels need to ﬁnd the right local developer, design ﬁrms, Pratt cautions, need to partner with a local ﬁrm or become a registered Brazilian ﬁrm (like VOA is) to avoid paying more than half their fees in taxes: “It causes most ﬁrms to price themselves out of the market.”

markets are reaching a balance between supply and demand, almost a bit of oversupply, so developers are open to hotels.” The need, according to Mader: “All types of product—mainly limited service—especially in state capital cities and secondary cities that are really growing. There are a lot of cities that were not even on the economic map a few years ago, and now they are booming because of growing agriculture, mining, and oil businesses.” Mader points to the northeast port town Recife (the new Sheraton will be 30 minutes away), while Teich touts cities such as Campinas, Sorocaba, Sao Jose de Rio Preto, and Joinville. “They all generally have very strong local business activities and inadequate branded hotel assets,” he says. Limited service properties may be getting the most attention, but a few companies are giving luxury a try. Aman is opening Amanoca, a 30-villa and 20-residential unit resort designed by Jean-Michel Gathy of Denniston International on 70 acres of beach and oceanfront land in Angra Dos Reis, one and a half hours outside of Rio. Even though Pat McCudden, senior vice president, real estate and development Latin America, Hyatt Hotels, says Hyatt’s greatest opportunity for growth is with Hyatt Place, the company recently announced a 436-room Grand Hyatt Rio de Janeiro, the ﬁrst Hyatt for the city, with interiors by Yabu Pushelberg and restaurant design by Arthur Casas. Meanwhile, local brand Fasano is expanding in Salvador, Belo Horizonte, and Trancoso. Says Constantino Bittencourt, one of the hotel group’s partners, “For Belo Horizonte, the hotel will be designed by Marcio Kogan in a building designed by Raphael Hardy in the 1960s, considered an icon of Brazilian modernism. Isay Weinfeld is designing Trancoso and Salvador. In Salvador, we are renovating a landmark building from the 1930s, which used to be the headquarters for the biggest local newspaper. And in Trancoso, we are on the most exclusive beach of the area.” According to Jones Lang LaSalle’s report, Resorts in Numbers – Brazil 2011, resorts may be the way to break into the luxury market. During the ﬁrst half of 2011, occupancy rose 10 percent over the prior year period, the highest growth recorded in this sector in two years. Of the 78 resort

Opportunities Knock
Despite the hurdles, “The overall performance of the industry has never been better in Brazil’s history. There’s good opportunity for development,” says Ricardo Mader, executive vice president for Jones Lang LaSalle Hotels in São Paulo. “The real estate markets were so strong, developers were focused on what they knew how to do. Now residential and ofﬁce

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Table of Contents for the Digital Edition of Hospitality Design - January/February 2012