‘Word of Mouth’ Key to Growth in Honduras

With an anticipated need for 20,000 hotel rooms over the next ten years, Honduras is seeing an increased level of hotel development. The Central American country of 7.4 million people attracted just over 1 million visitors in 2006, and international tourist arrivals have grown an average of 12 percent per year in the past five years. Liliana Sanchez, investment officer for FIDE Investment and Exports, the Honduran government’s national investment promotion agency, talked about hotel development in in this Central American nation of 7.4 million people. CPN: Are you seeing increased hotel development in Honduras, and, if so, why?Sanchez: Yes, we are. I think one reason is that we’ve benefited from all of the buzz about Costa Rica and Cancun. But it sometimes can be difficult to find land to build on in these areas. We’ve grown by word-of-mouth. We have a lot of Americans who come down here to go diving. We have the second largest coral reef in the world, and they have spread the word about us. CPN: What difficulties have developers faced in building hotels in Honduras, and what has the government done to spur hotel development? Sanchez:  It is a chicken-and-egg situation. Large hotel companies didn’t want to build down here, because they weren’t seeing the tourist traffic, and tourists weren’t coming because there wasn’t enough airlift. But airlines have added more flights, as demand has gone up. The government has given a ten-year tax holiday on new hotel projects. The government sees tourism as a way to increase employment, not only at hotels, but tourism will help other businesses, such as farms, which grow fruit that can be served in the restaurants. As of now, Honduras does not have any resorts with a major international flag, although a Westin will open in 2009. The government has donated land for development of the Los Micos Beach and Golf Resort, near the town of Tela, which is 50 minutes from the airport at San Pedro Sula. The property borders a rain forest, and has both a four-star and five-star hotel, in its first phase, and some large international hotel companies have show interest in the site. It’s the flagship development in the Honduras.CPN: Where are Honduras’ tourists visiting from? Sanchez:  Many are from the U.S. We’ve also seen an increased number of visitors from Europe. A tour group from Italy brings groups here regularly. The Italian version of “Survivor” is filmed on one of the keys here. We’re also seeing more Canadian visitors.