THE PLANNED expansion in Jamaica's hotel sector is not expected to put pressure on room rates, says Director of Tourism Paul Pennicook.
The supply of hotel accommodation is set to expand substantially over the next few years, based on massive investments planned and being undertaken by Spanish hotel chains. Mr. Pennicook was responding to the question from Wednesday Business, whether the demand might not fall short of this increased supply, and undermine room rates.
"There will not be a spike in accommodations in 2005," Mr. Pennicook said. Just about 1,000 rooms will be added through to that year.
Jamaica now has 16,723 hotel rooms. But more than 11,000 hotel rooms are expected to be built within 10 years, according to Kingsley Thomas, managing director of the National Development Bank.
PHASED EXPANSION
But the additional rooms are to be phased in over a period, Mr. Pennicook said.
The Piñero Group is to build three hotels with more than 1,200 rooms over a period of three years. Riu is now developing its second hotel in Negril and Sandals will be looking to make progress this year on the construction of its Whitehouse Hotel in Westmoreland. "The main builder is the Piñero Group," Mr. Pennicook said. But construction
of their first hotel begins in October, with an opening date set at March
of 2006.
Riu has shown that these hotels can improve the industry, he said. It is increasing the tourist traffic out of Europe, with increased charter business coming from Belgium, Austria and Switzerland.
Not only are they pulling in more tourists, but they are attracting a different segment of the market which finds their offerings appealing, he said.
"Hotels are seeing an increase in average daily rates this winter," he said. "Room rates have been trending up."
