AMDETUR Editorial
Dear Readers:
I
would like to take this opportunity to extend you all a warm welcome to the 25th annual AMDETUR Convention, from this idyllic state of Quintana Roo, one of Mexico's most popular tourist destinations, and currently home to 127 vacation property resorts including Cancun, the Riviera Maya, Playa del Carmen and Cozumel. The state boasts vacation properties, occupying a substantial market share in the total supply of lodging. For this convention, we have put together a fascinating program of speakers, on topics not limited to the tourist industry: we have also invited some major celebrities to share their views on current events that will help us to reflect and enrich our professional and personal lives. In this grand celebration, this year AMDETUR is joined by the Quintana Roo Vacation Club Association, which is also celebrating the 25th anniversary of its founding, and has offered us a Forum for the Americas on Marketing and Sales for Vacation Clubs, a splendid new addition to AMDETUR's event. The Association of Time Share Developers and Tourist Promoters of Puerto Vallarta is also celebrating its 25th year, and the Baja California Sur Association of Time Share Developers is enjoying its 15th year of activities, which attests to the seriousness and consolidation of this industry, and its ongoing commitment to offer professional, top-quality services. Through this joint effort, along with the work of official agencies and private organizations, we have succeeded in positioning ourselves and earning widespread recognition not only in Mexico but internationally, a distinction that sets Mexico apart from the rest and makes it one of leading forces in the worldwide tourism industry. I am also pleased to announce that because of the huge success last year of our University-Business Link program, we are once again including presentations focused especially on university students working toward degrees in the field of tourism, to familiarize them with aspects of this business, encourage them to make their career in tourism, and thus to improve the level of education and professionalism of the entire industry. Finally, and based on the results of our efforts this year, and in response to requests by our members, our goal is to make the AMDETUR convention a traveling event. We want to make it our priority to promote each and every one of the resorts affiliated with AMDETUR, and create a more dynamic event with more participants and more benefits than ever for those attending. We welcome your comments and suggestions on how to improve this event and raise expectations with every passing year. Thank you for participating.
Sincerely, Juan Vela RUIZ CHAIRMAN
Summer
1
AMDETUR
www.amdetur.org.mx In this Issue:
Board of Directors Chairman Juan Vela Ruiz Grupo Velas Executive President José Alfonso Bayón Ríos Amdetur Secretary Gerardo Rioseco Orihuela Fiesta Americana Vacation Club Treasurer Jaime Márquez Vargas Royal Holiday General Counsel Juan Manuel Gutiérrez Nava Lecumberri, López y Gutiérrez Nava Counselors José Carlos Azcárraga Andrade - Fiesta Americana Vacation Club Carlos Berdegué - El Cid Resorts Ricardo Montaudon Corry - RCI Kemil Rizk - Royal Resorts Marcos Agostini - Interval International Juan Carlos Barillas – Sol Meliá Vacation Club Jorge Pallas Cáceres - Promotora Cancún Sunset Clubs Juan Ignacio Rodríguez - RCI Robert Louis Kistner - Grupo Villa Director Rosa de Jesús Lugo Dorantes Notitur is the official magazine of the Asociación Mexicana de Desarrolladores Turísticos, A.C. (Amdetur) (Mexican Resort Development Association), published four times a year for its members and major official tourism organizations in Mexico. Notitur’s digital version in English is electronically distributed in several countries. All rights are reserved. This publication may not be reproduced in whole or in part without the prior written permission of the publisher: Opinions expressed in this publication are not necessarily those of the editor or Amdetur and no responsibility is accepted for lack of precisions in editorial or advertising content. Original magazine hard copies printed in Mexico. Amdetur: Montecito 38, Piso 32, Ofics. 11 a 14, Col. Nápoles, México 03810 D.F. Certificado de Licitud de Título No. 3856, de fecha 19 de abril de 1989. Certificado de Licitud de Contenido de la Comisión Calificadora de Publicaciones y Revistas Ilustradas No. 3172 de fecha 19 de abril de 1989. Número de Certificado de Reserva otorgado por el Instituto Nacional del Derecho de Autor, Secretaría de Educación Pública, 04-2005030817343600-102. NOTITUR JULY-SEPTEMBER 2011. e-mail: amdetur@prodigy.net.mx
NOTITUR President Juan Vela Ruiz Executive President José Alfonso Bayón Ríos Publisher AMDETUR EDITOR Aurora Martínez V. Graphic Design Reacción Gráfica S.A. de C.V. Tel. 52(55) 5004-4176 Art Director Sergio Octavio Funes Navarrete tavofunes@reacciong.com Distribution AMDETUR Amdetur Photographer José Mata Cel. (04455) 1885 8581 www.pbase.com/ppmata LOCAL ASSOCIATIONS Patricia de la Peña Asociación de Clubes Vacacionales de Quintana Roo, A.C. Alejandro Lemus Mateos Asociación de Desarrolladores y Promotores Turísticos de Tiempo Compartido, A.C. (Puerto Vallarta) Jesús García Torres Asociación Sudcaliforniana de Desarrolladores de Tiempo Compartido, A.C. Emmanuel Omaña Camín Asociación de Promotores de Clubes Vacacionales del Estado de Guerrero, A.C. Fernando de Leeuw Santiago Asociación de Clubes Vacacionales de Cozumel, A.C. Fernando Madero Irizar Asociación de Clubes Vacacionales de Sinaloa, A.C. Héctor Mauricio Sánchez Ochoa Asociación de Desarrolladores Turísticos de Colima, A.C. Raúl Manzanares Romero Asociación de Desarrolladores y Operadores Turísticos de Ixtapa y Zihuatanejo, A.C.
If you would like to receive the electronic version of Notitur in Spanish or English, you can request it at:
aurora.martinez@prodigy.net.mx
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NOTITUR
14 Tourism in Mexico: Facing the challenge of rising growth
In this issue, we present the first part of an article by BBVA Bancomer analyzing the myths and realities that surround the industry, as well as its competitiveness and prospects for 2011. The second part of this article will appear in our next issue (Autumn 2011).
18 Investment in Sustainable Tourism: Mexico's Alternative
Following a series of difficult circumstances affecting tourism in Mexico, the business world is optimistic about President Felipe Calderon's initiative, the signing of the National Agreement for Tourism, and about the investment opportunities it will bring to the industry.
Sections: 4 How much do foreign tourists spend in Mexico? •According to the annual report prepared by Visa Inc, "Tourism Outlook: Mexico," spending by foreign tourists in Mexico has been growing steadily after overcoming the obstacles of 2009.
8 U.S. Timeshare Industry refocuses on Global Opportunities
The recent global economic crisis and recession in the United States heavily affected the business model traditionally applied in the timeshare industry, forcing it to change strategy and refocus on international markets.
10 Celebrating 25 years of AMDETUR Conventions
Since 1987 AMDETUR has hosted the most important event in the Mexican vacation ownership industry, today celebrating 25 years of success, thanks to the support of its affiliates and recognition of renowned figures from the tourist industry.
Industry AMDETUR
It is always a pleasure for AMDETUR to share each of its successes with its members and friends, knowing besides that every one of their successes is a milestone in the growth of this association as well as the consolidation of our industry. In this spirit, we congratulate Interval International for its 35th anniversary, and urge it to keep building and moving ahead, toward the winning future this industry promises.
INTERVAL INTERNATIONAL celebrates 35 YEARS of leadership and innovation
in shared ownership
I
nterval International, a prominent worldwide provider of vacation services and an operating business of Interval Leisure Group (Nasdaq: IILG), is celebrating 35 years of leadership and innovation in the shared ownership industry. As a pioneer in the field, Interval helped advance legislation that established the foundation for the concept’s growth in markets around the globe and committed to quality in every aspect of its operations, including its unparalleled vacation exchange network. Over the years, the company has created landmark products that came to be industry standards; steadfastly supported resort-developer clients in their sales and marketing efforts; and provided member families with hightouch service and effective programs designed to meet and exceed their expectations. “It is a tremendous honor to have participated in leading the talented team at Interval to where we are now. And it is very exciting to have the opportunity to shape Interval’s future, so that we will continue to play an integral role in the achievements of our evolving industry,” said Craig M. Nash, chairman, president, and CEO of Interval Leisure Group. “We are pursuing a number of new initiatives that will enrich our consumer member benefits and further align our business with our valued clients, who have been such a tremendous part of our success.”
Interval has an impressive history of exchange industry “firsts” such as the first quality recognition program in 1982; a quality rating system developed in collaboration with Cornell University’s School of Hotel Administration in 1985; an enhanced membership program in 1987; a trial program for non-buyers in 1991; and the first exchange company presence on the Internet in 1995. Today, Interval is part of a publicly traded company and boasts some 2,600 affiliated resorts in more than 75 countries. Approximately 2 million member families are enrolled in its various membership programs and hundreds of clients use its benefits and services. Recent product launches include Interval PlatinumSM, the company’s ultimate membership level. Along with Interval Gold®, it expands the premium benefit offerings, making Interval’s membership options among the most comprehensive in shared ownership. Another enhancement to the company’s innovative product line-up is Club Interval GoldSM, a points-based exchange service for owners of fixed- or floating- week interests that combines all the membership benefits of Interval International and Interval Gold® and provides a more flexible vacation exchange option. In addition to these milestones, the company has also been a proactive market-maker
through the Shared Ownership Investment Conferences that it founded in 1998. Since the first events were held in the United States and the Caribbean, venues have been extended to Beijing, Budapest, Cape Town, Dubai, Durban, Johannesburg, Macau, and Shanghai, with Mumbai and Delhi scheduled later this year. Nash concluded, “All of our dedicated employees look forward to exploring new avenues for innovation and continuing to set new standards for shared ownership.”
About Interval International Interval International operates membership programs for vacationers and provides value-added services to its developer clients worldwide. Based in Miami, Florida, the company has been a pioneer and innovator in serving the vacation ownership market for 35 years. Today, Interval has an exchange network of approximately 2,600 resorts in over 75 nations. Through offices in 15 countries, Interval offers high-quality products and benefits to resort clients and approximately 2 million families who are enrolled in various membership programs. Interval is an operating business of Interval Leisure Group, Inc. (Nasdaq: IILG), a leading global provider of membership and leisure services to the vacation industry. Summer
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IndustrY
How much do
international tourists spend
in Mexico?
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NOTITUR
IndustrY
The amount of money international tourists spend during their stay in Mexico is one of the most useful indicators for sizing up the success of our promotion and marketing of tourist products. It is therefore encouraging to note that this figure is rising again, having overcome some daunting obstacles in 2009, as can be seen in the report by Visa Inc. entitled "Tourism Outlook: Mexico," in which it analyzes the consumption of its cardholders visiting this country.
I
n its third annual report, Visa presents data on the amount, source and destination of the money Mexico received in 2009 and 2010 from international travelers who used their Visa cards in Mexico. In 2010, this amount reached $4.4 billion dollars, compared to $3.9 billion in 2009.
Countries contributing the most to Mexico's tourist revenues In 2010, visitors from the United States were once again the biggest contributors to Mexican tourism revenues, accounting for $3.1 billion dollars--more than double total spending by the card holders of the next top 25 tourism spending countries combined--while Canadian travelers came in second with $583 million, a 21 percent increase over 2009. But tourists from other regions also sharply increased their spending in Mexico between 2009 and 2010, confirming Mexico's role as an attractive travel destination in the world's tourism market. In Europe, countries like Germany, Spain, Italy and the United Kingdom were among the top 10 spenders in Mexico, while South America saw the strongest growth as a source for travelers to Mexico, led by Brazil, with $54.5 million (85 percent more than in 2009), Guatemala with $26.4 million (26 percent more) and Argentina with $25 million (53 percent more than the year before). The following chart shows the countries that contributed the most of Mexico's tourist revenues according to the level of spending by Visa cardholders, and the percent change seen from 2009 to 2010.
10 Countries contributing the most to Mexican tourist revenues, 2009-2010 (in U.S. Dollars) Source Country
2010
2009
% Growth YoY
1
United States
$3.1 billion
$2.9 billion
7%
2
Canada
$538 million
$445 million
21%
3
Spain
$102 million
$88.3 million
16%
4
France
$89.8 million
$78.2 million
15%
5
United Kingdom
$83.3 million
$65.2 million
28%
6
Brazil
$54.5 million
$29.5 million
85%
7
Germany
$43.3 million
$35.6 million
22%
8
Italy
$32.8 million
$28 million
17%
9
Guatemala
$26.4 million
$21 million
26%
10
Argentina
$24.9 million
$16.3 million
53%
Source: VisaVue Travel Data, 2009-2010
Summer
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Industry
2010: A year of recovery Even though Mexico's tourist industry has faced some tough problems recently, like the H1N1 flu outbreak and sluggish recovery of the world economy, by late spring-early summer 2010, a marked recovery was already under way. Compared to 2009, foreign tourist spending grew 13 and 9 percent, respectively, in March and April, and in May international travelers spent 44 more than in the same period of last year, when the country was dealing with the flu situation. The growth continued in June with 18 percent and July with another 11 percent. Finally, after the Mexican government raised its flu alert after 14 months of waiting, a large number of foreign tourists returned to Mexico's most popular beach destinations, resulting in a 23 percent rise in the influx of tourists from the United States and 100 percent in Canadian travelers, compared to 2009.
Tourism revenues by market segment The biggest chunk of tourist spending in Mexico was in retail establishments, like clothing and food stores, accounting for around 51 percent of all purchases made using Visa cards, a total of more than $2.3 billion dollars. In the travel segment, lodging accounted for 17 percent; other travel and entertainment, 7 percent; restaurants, 5 percent; and airlines--which saw impressive growth between 2009 and 2010--4 percent. These four segments accounted for almost $1.5 billion in spending.
2009 and 2010 Inbound transaction volume in top merchant categories 2010
2009
General retail
Market segment
$2.3 billion
$2.2 billion
3%
% YoY growth
Lodging
$738 million
$622 million
19%
Other travel and entertainment
$310 million
$278 million
11%
Restaurants
$220 million
$186 million
18%
Airlines
$191 million
$65.8 million
191%
Source: VisaVue Travel Data, 2009-2010
2009-2010 Month-by-month inbound international spending comparison OVER TOP MERCHANT CATEGORIES TOTAL Mes January
2010
2009
$446 million
$415 million
% YoY growth 7%
February
$420 million
$382 million
10%
March
$483 million
$427 million
13%
April
$397 million
$364 million
9%
May
$335 million
$234 million
44%
June
$311 million
$263 million
18%
July
$333 million
$300 million
11%
August
$326 million
$300 million
9%
September
$269 million
$246 million
9%
October
$317 million
$285 million
11%
November
$366 million
$336 million
9%
December
$435 million
$417 million
5%
Source: VisaVue Travel Data, 2009-2010
Outlook for 2011 The twelve percent rise in spending by international tourists using their Visa cards during their visit to Mexico, from $3.9 billion to $4.4 billion dollars, is a signal that confirms once again that tourism in Mexico continues to growth, and underscores our certainty that this industry is capable of overcoming any obstacle. That is why we see more extraordinary growth opportunities ahead for 2011, especially because this year has been declared the “Year of Tourism” by President Felipe Calderon, and thanks to the combined efforts of public agencies and private enterprise, among which Visa reiterates its commitment to helping meet the goals we have set. Visa cardholder spending data cited is based on data from VisaVue® a review of cross-border spending on Visa-branded payment cards by cardholders from key source countries while in Mexico during the calendar years 2009 (January 1 – December 31, 2009) and 2010 (January 1 – December 31, 2010). These findings are based upon VisaVue® Travel data. For more information on the report "Tourism Outlook: Mexico," contact: globalmedia@visa.com Visa is a global payments technology company that connects consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable digital currency. Contact: Rocío García, Visa Inc., Mexico. (55) 5387-4134 rogarcia@visa.com
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NOTITUR
As a point of comparison, here are some highlights of the 2009 VisaVue report: • In 2008, Mexico saw an 11.36 percent growth in tourism revenues. • In the same year, tourists from the United States accounted for 80% of tourism revenues in Mexico. • The countries hose citizens were most likely to visit Mexico in the future were: United States (72%), Brazil (61%), Canada (58%), China (43%) and the United Kingdom (39%). • The most popular tourist destinations among foreign travelers in Mexico are: Cancun (45%), Acapulco (43%), Mexico City (41%), Puerto Vallarta (26%), Cozumel (21%), Guadalajara (18%), Playa del Carmen (17%), Riviera Maya (16%), Los Cabos (15%) and Tijuana (13%).
INDUSTRY
By Howard Nusbaum
U.S. Timeshare Industry Refocuses on
Best Business Practices,
Global Opportunities
The downturn in sales created by the havoc of the recent global financial crisis and recession in the United States was a humbling experience for timeshare developers.
B
eginning with the collapse of Lehman Brothers (9/15/08), the U.S. credit markets froze, and lenders stopped lending … even to companies with a long history and excellent credit rating. This was particularly damaging to our industry, given its traditional business model, which relies heavily on credit markets to monetize consumer debt and even out cash flow for developers. Although the credit freeze was a painful lesson, it served as the catalyst to refocus and strengthen our fundamental business model.
Change of Strategy Due to the present economic environment and lack of access to capital, developers have shed more inefficient marketing channels and have moved forward from the direct sales and marketing model of the past to more traditional and strategic marketing models that have streamlined costs. This change has been further enabled by the overall traveling public’s acceptance of timeshare as a great way to vacation and a mainstream lodging alternative.
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NOTITUR
Although 2010 sales were basically flat over 2009 (just slightly higher), better days are ahead, with industry sales beginning to truly “dig out” in 2011. The reason I say this with confidence is because sales reductions were primarily self-induced, attributable to the lack of access to capital to fund consumer notes. Developers intentionally slowed sales for this reason. We are seeing capital begin to flow back into the market and more importantly, we see sales rising (as evidenced by the last two quarters). In the past, sales velocity was king—today, margin and profitability reign. This is seen in higher down payments (averaging 20%); more due diligence on qualifying customers (FICO scoring is now the norm); more efficient marketing; and a more sustainable business model. Basically, U.S. developers are focusing more on resort development profit from the initial sale rather than depending as heavily on arbitrage financing income in this new model. Our customers are also doing their part. Nine out of ten are current with their main-
tenance fees and/or mortgages. Occupancy rates have remained steady at 80 percent (2009), as has owner satisfaction, at 84 percent (2009). Both of these metrics, along with the steady rise in the price of an interval, have gotten the attention not only of lenders but also the resort communities (destinations that rely on tourism for their economy). These destinations want tourism assets to help even out the dips in their local economy—and timeshare has proven to be less sensitive to occupancy swings.
New Perspectives Overall, these changes have led to a stronger business model, closer, in fact, to the one used in Mexico. In many ways, Mexico is a great example of a strong resort development industry that is less reliant on lending. I am glad to report that after surviving the worst economic recession since the 1930s, the U.S. timeshare industry is and will continue to adapt and change to meet the needs and vacation preferences of today’s customer.
The timeshare industry has become a global business. Customers are increasingly interested in exercising their wanderlust through international vacation experiences. We are seeing an expansion in international development and partnerships by U.S.- based developers, with more domestic timeshare owners exploring resort exchange and purchase opportunities in Latin America, the Caribbean, and Europe. Now with more resort development in China, India, Southeast Asia, and South America, there are new opportunities for all developers and timeshare purchasers. This global trend is clear here at ARDA, where we are in the midst of planning for
ARDA is pleased to be a part of this year’s AMDETUR Conference and to celebrate the ongoing success of the Mexican resort development industry and its promising future. We also invite all of the Mexican resort development community to mark the industry calendar for ARDA World or ARDA Mundo next April in Las Vegas. Together, we can work toward a stronger global industry and better vacations for people around the world.
the 2012 ARDA Annual Convention. The convention, now dubbed “ARDA WORLD,” will be more focused on the global vacation ownership experience, with enhanced international networking and a wide range of global educational sessions. Held at the Venetian Resort Hotel and Casino in Las Vegas, Nevada, April 1-5, 2012, this is an exciting new direction for ARDA. In addition to an increased interest in global expansion by our US developers, we are hearing that same interest expressed by colleagues from Latin America, Asia, Canada, Europe, the UK, the Middle East, Africa, and the Caribbean who attended the 2011 ARDA Convention.
Howard C. Nusbaum is currently President and Chief Executive Officer of the American Resort Development Association (ARDA), the Washington D.C.-based professional association representing the vacation ownership and resort development industries. Before joining ARDA in 2000, Nusbaum was Director of Corporate and Industry Relations for the American Hotel & Lodging Association as well as Executive Vice President of the Ohio Hotel & Lodging Association. Before joining the world of hotel association management in 1990, he was Vice President of Marketing for Janus Hotels and Resorts, a hotel management company with more than 50 hotels and motels nationwide. He serves on the Board of Directors of the U.S. Travel Association and its Executive Committee. He previously served on the Board of the Travel Business Roundtable. Mr. Nusbaum is also a member of the Real Estate Roundtable, a Washington D.C. advocacy organization for all types of real estate. He is a graduate of the University of Cincinnati. Post collegiate education includes the respected Institute for Organization Management, a sixyear program for Association Executives. Among other acknowledgements, he received national recognition for his development of the very successful HOST Welfare-to-Work Program.
A chat with…
Rosa de Jesús Lugo Celebrating 25 years of AMDETUR Conventions
This year is especially important to our Association, as we celebrate the 25th anniversary of our Annual Convention.
Cover of the printed program that was published for AMDETUR's first Convention in 1987.
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NOTITUR
Eduardo Chabert García, Sergio Montero Querejeta, Luz María Torres González, Rosa de Jesús Lugo, John McCarthy Sandland, Pablo González Carbonell, Jorge Pallas Cáceres.
T
he first Convention was held in January 1987, when AMDETUR was just beginning to take shape, and it was organized by its founding partner, Grupo ICA, and what was then called the American Resort and Residential Development Association, today the American Resort Development Association (ARDA). The 1987 Convention brought together a select group of developers and investors from Mexico, who began discussing the foundation of what would be an Association of professionals from different fields involved in the tourism business, specifically in the planning, development, marketing, administration and operation of tourist real-estate developments. The response was not long in coming, and the idea was warmly welcomed. A number of meetings were held during the course of the Convention, and those present agreed to form a group that would handle the details of creating what is now the Mexican Resort Development Association (AMDETUR) was thus founded on July 13, 1987, thanks to the efforts and tenacity of eight companies that a quarter of a century ago had the foresight to bring together this country's leading investors and resort developers, and to promote and professionalize the Timeshare industry in Mexico. One of the most enthusiastic proponents of the Convention and of the foundation of AMDETUR was the man who was at the time President of ARRDA, Gary Terry, whose support and disinterested encouragement in our proposals was tremendously important in achieving our goals.
With all of this, the 1987 Convention was a resounding success, as it was the first event of its type in Mexico, and stirred up widespread interest in the industry. It was attended by promoters, developers, operators, marketers and other professional groups involved in the tourism business.
The Next Steps Once the Mexican Resort Development Association (AMDETUR) was founded, it began working together with the American Resort and Residential Development Association on organizing the next Tourist Resort Development Convention in Mexico, held in 1988. The event was once again a success, and surpassed attendance goals. The organization and logistics went more smoothly because of the past experience, and a committee was created with the participation of Interval International, RCI, Grupo ICA, ARRDA, AMDETUR and other members that devoted their energy and professionalism to bringing together and holding the Convention. One outstanding aspect of the second convention was the presence of then-Minister of Tourism, Antonio Enríquez Savignac, who swore in the first AMDETUR Board of Directors during the opening ceremonies, then turned over the floor to Alejandro Morones, who officially opened the second Annual Tourist Resort Development Convention. Starting with the third Convention, AMDETUR assumed the leadership role and
A chat with…
since then has been a strong supporter for the event, which was from the beginning the largest in the vacation ownership industry, and has grown bigger and stronger of the past 25 years , thanks to the support of all its members. AMDETUR's road has not always been an easy one, and the Association has had to deal with averse circumstances, but we are highly pleased to say that today, the Mexican Resort Development Association (AMDETUR) is one of the most widely-recognized and prestigious tourist industry associations among federal, state and municipal authorities, as well as leading organizations in the national and international tourist industry. AMDETUR has also grown stronger through the support it has received from local affiliate associations, with which it has worked closely to promote and encourage tourist realestate developments in this country. These include: • Asociación de Clubes Vacacionales de Cozumel. • Asociación de Clubes Vacacionales de Quintana Roo, this year celebrating its 25th year of existence. • Asociación de Desarrolladores Turísticos de Colima. • Asociación de Desarrolladores de Tiempo Compartido de Mazatlán. • Asociación de Desarrolladores y Operadores Turísticos de Ixtapa y Zihuatanejo. • Asociación de Desarrolladores y Promotores Turísticos de Tiempo Compartido (Puerto Vallarta), also celebrating its 25th anniversary. • Asociación de Promotores de Clubes Vacacionales del Estado de Guerrero. • Asociación Sudcaliforniana de Desarrolladores de Tiempo Compartido, which just completed its 15th year of activities.
Our Biggest Strength Between 1987 and 2011, AMDETUR has had 14 presidents, and each of them has contributed to the strength and consolidation of this group. The challenges they have faced have varied greatly, but clearly their dedication and commitment have been decisive factors in making AMDETUR what it is today: a leading group in the Mexican tourist industry. In parallel, the AMDETUR Convention has become an increasingly prominent event over these years, thanks to the efforts of all these presidents, who worked tirelessly to meet the expectations of conference attendees and to promote the growth of this important industry. We are confident that our Annual Convention will continue to be the best event in its class, and that with every passing year it will become more interesting and useful to attendees, and an excellent forum for bringing together the most renowned personages in the tourist industry and keep the fast-growing vacation ownership industry constantly up to date. Our profound gratitude goes to all the presidents of AMDETUR:
• • • • • • • • • • • • • •
Alberto Villada Camerino 1987 - 1989 Fernando González Corona 1989 - 1990 Sergio Montero Querejeta 1990 - 1992 John McCarthy 1993 – 1994 Eduardo Chabert García 1995 – 1996 Raúl Sánchez Rucobo 1996 - 1997 Mario Muro Aguirre 1998 Manuel Niembro Tapia 1998 - 1999 Pablo González Carbonell 2000 - 2001 Luz María Torres 2002 - 2003 Jorge Pallas Cáceres 2004 - 2005 Ernesto Coppel Kelly 2006 - 2007 José Carlos Azcárraga 2008 - 2009 Juan Vela Ruiz 2010 - 2011 And thanks as well to each and every one of you, because without your participation in this event we could not celebrate and share such significant moments for our industry. AMDETUR IS CELEBRATING 25 YEARS OF ITS ANNUAL CONVENTION, and we proudly reaffirm our commitment to holding this event each year for our members, making it stronger and drawing broader recognition every year and taking on the continual challenge of innovation and creativity. For this reason, and at the urging of our members, our goal is now to make the AMDETUR convention a traveling event. We want to make it our priority to promote each and every one of the resorts affiliated with AMDETUR, and create a more dynamic event with more participants and more benefits than ever for those attending.
Cover of the printed program that was published for AMDETUR's first Convention in 1988.
ON TO THE NEXT 25 YEARS!! Rosa de Jesús Lugo has worked with AMDETUR since its beginnings, and has helped organize all 25 conventions. She joined Grupo ICA, AMDETUR's founding partner, in October 1986, and worked directly with Alberto Villada Camerino in the organization and logistics of the first Tourist Development Convention in Mexico, an event during which the decision was made to take steps to create what is today the Mexican Resort Development Association (AMDETUR), whose founding president was Mr. Villada Camerino himself. After that first Convention, Rosa de Jesús worked alongside Gumaro Lizárraga, Vice President of the Tourism Division of Grupo ICA, who offered her the position of Manager of AMDETUR, and then Fernando González Corona, AMDETUR's second president, made her Director of the Association. Rosa de Jesús has collaborated with 14 AMDETUR presidents, during which time she accumulated a wealth of highly positive experiences, learning from each of them a different style of working and visualizing different perspectives. She studied Business Administration at Milwaukee Area Technical College in Wisconsin, where she obtained an Honorable Mention, and was also awarded the Phil Theta Kappa distinction for academic achievement. Summer
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Tourism in Mexico
Tourism in Mexico: Facing the challenge of
rising growth
By Fernando Gonzรกlez and Adolfo Albo, BBVA Bancomer
Tourism has always been a key contributor to economic development in any nation. In Mexico's case, fortunately, we have what it takes to promote the industry and give it a more prominent place in the country's economy, provided we know how to understand and take advantage of its tremendous potential.
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NOTITUR
Tourism in Mexico
I
10.50
1,000 950
I
II
III
10.00
900 850
9.50
800 9.00
750 700
8.50 650
Aggregate value at 2010 prices
8.00
2010e
2009e
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
600 1993
% weight in GDP
Source: BBVA Research with data from INEGI, SCNM, CST 1994 and 2008. Series integrated from two series with different bases.
Revenues from international visitors to Mexico Constant dollars (1980 = 100, last data September 2010, 3M moving average) 300 250 200 150 100 50
Tourist
2010
2008
2006
2004
2002
2000
1998
1996
1994
1992
1990
1988
1986
0 1984
• "Tourism is one of the fastestgrowing segments of the economy.1" In 2008, the aggregate value of tourism activity in Mexico was more than 980 billion pesos2, equivalent to 8.7 percent of the overall economy, and had grown by 33 percent since 1993. But the industry, however dynamic, shrank in proportion to the rest of the economy, as overall Mexican GDP outpaced the growth in tourism activity by almost a full point each year. • "Tourism is the largest source of foreign currency." For Mexico, tourism currently ranks fourth in the attraction of foreign currency, coming in behind oil exports, wage remittances, and foreign direct investment. • "Tourism is labor-intensive." The tourism industry is estimated to have generated 2.5 million paying jobs in 2008, equivalent to 6.9 percent of the national wage base. It is clearly significant that tourism has kept up its historic share of total employment, but an increasing amount of capital is needed to build more infrastructure, services, and lodging. This is why it is so important that the various agents in the Mexican economy-authorities, entrepreneurs, and civil society-work together to make the best use possible of the available resources. • "Mexico is one of the top tourist destinations in the world." In 2009, Mexico ranked tenth in the world flow of international tourists (staying at least one night), with 21.5 million visitors. But 42 percent of these visitors were cross-border travelers contributing only 6 percent of total revenues. So the more important component of foreign tourists, those responsible for demand and vigor in the industry, totaled only 12.7 million travelers.
(billions of 2010 pesos and % of GDP)
1982
A. Myths and Realities
Aggregate value and weight in the economy
1980
n this issue, we present the first part of this article, in which we examine six big myths and realities about the industry, so that we can provide a balanced diagnosis of both sides of the tourism coin. This will help all of us who are interested in the industry to direct our efforts toward building a more solid and dynamic tourist industry and to work together as a society. In the next issue of Notitur, we will continue on this topic, addressing other equally important aspects like international competitiveness and the outlook and projections on the tourist industry in the near future.
Cross-border traveler
Source: BBVA Research with data from Banco de Mexico 1 Given the nature of the information available, reference periods may be different: structural analysis based on data through 2008 from national accounts and trend evolution based on coincidental indicators. 2 At 2010 prices.
Summer
15
Tourism in Mexico
Fernando González Cantú is Senior Economist for Sectorial and Regional Analysis at Grupo Financiero BBVA Bancomer, where he has worked in various positions since 1993. He has also given classes in the Economics Department and Masters' Degree programs in Urban Settlements and Health at the Universidad Autónoma de Nuevo León, and in the Economics Department of the Instituto Tecnológico y de Estudios Superiores de Monterrey, and was professor and full-team researcher at Colegio de México's Center for Economic and Demographic Studies. He earned his undergraduate degree in Economics from the Universidad Autónoma de Nuevo León and has taken specialization courses in demographics from the U.N. Latin American Center for Demographics at the University of Chile.
Adolfo Albo Márquez is Chief Economist in Mexico for BBVA Bancomer, Grupo BBVA, where he is in charge of research in the areas of macroeconomics, finance, banking, pensions, industry, regional, real-estate and migration. He earned his master's degree from ITAM with honors, and was awarded the Banamex Economics Prize as well as the National Prize for Economics Consultancy (Tlacaelel). He has also taken postgraduate courses in economy and finance and published studies in collaboration with the IDB and OECD. For more than 5 years he was in charge of analysis and study of emerging economies and markets; and was Chief Economist for Latin America at BBVA headquartered in Madrid, Spain; and Director of Investment Strategies for Latin America.
Hotel Occupancy In 29 states, domestic tourism predominates; foreign tourism is greater in only 3 100% 90% 80% 70% 60% 50% 40%
Foreign guests average (35.4%)
30% 20% 10% 0 Tlax Dgo Hgo Tab Ver Mich Tamps Ags Mor Qro Gto SLP Zac Son Méx Chih Oax Gro Col Pue Chis NL Camp Coah Yuc DF Sin Jal BC Nacional Nay BCS QR
This means that in that year, Mexico received 2.4 percent of the world's international travelers but only 1.3 percent of the revenues, coming in 20th in terms of this indicator; 31st in terms of tourist spending, and 51st in terms of competitive in rooms per inhabitant3. The number of longer-staying and higher-spending tourists have been growing steadily over the long term, but concentrated heavily in the states of Quintana Roo and Baja California Sur, as well as Mexico City. • "Tourism and travelers are synonymous." Tourist activity should be considered more broadly than it has in the past, when it was considered to include only vacation or leisure travelers. It should also include those who travel for family, religious, or health reasons, retirement, and other motives. This allows us to view tourism in a more comprehensive light and to identify specific niches where there are growth opportunities, like medical tourism, or retirement-age baby boomers from the US4. • "Not all tourists are foreigners." In Mexico, most tourists are Mexican citizens, measured in terms of their number (82 percent of the total), hotel nights (68.3 percent) or air passengers (65 percent), to mention just a few indicators. But foreign tourists stay longer on average, 3.4 days, compared to a 1.6-day average among domestic travelers. They also have a strong presence in the three states where Mexico's most popular beach destinations and four- and five-store hotels are located, and they spend more on average than domestic tourists. As we remarked at the start of this article, analyzing these points helps us objectively differentiate the benefits and areas of opportunities to be found in the Mexican tourist industry--undoubtedly one of the most reliable and promising sources of total growth for this country--in order to work in the right direction and reach the goals set forth in established plans, like the National Agenda for Tourism. In the second part of this article, which will be included in the next issue, we will continue to analyze other myths and realities of tourism, and will discuss competitiveness and a view to the future.
Source: BBVA Research with data from Ministry of Tourism, Datatur
Comments: f.gonzalez8@bbva.bancomer.com and a.albo@bbva.bancomer.com
3 Source: BBVA Research with data from UNWTO, Tourism Highlights 2010, and WEF, The travel & Tourism Competitiveness Report, 2009 4 See Situación Inmobiliaria México, September 2007, which discusses this tremendous potential in US retirees, for example for the real-estate industry.
16
NOTITUR
Foreign Domestic
Investment AMDETUR in Sustainable Tourism
Investment in Sustainable Tourism:
18
NOTITUR
Mexico's Alternative By Juan Bremer
In the past two years, international tourism has faced many challenges. The global economic crisis fostered rising unemployment and raised the cost of
Por Juan Bremer
credit, while the H1N1 flu virus pandemic depressed worldwide tourism activity, leading even the U.N. World Tourism Organization (UNWTO) to declare 2010 one of the worst years in two decades. Mexico was deeply affected by the crisis, and is still suffering noticeable consequences, aggravated by the perceived problems of crime and violence in much of the country, some of it in popular tourist zones like Acapulco.
Primavera
19
Investment in Sustainable Tourism
The adverse effects of these circumstances on the Mexican tourism industry found a tailor-made solution in the recent signing of the National Agreement for Tourism, promoted and organized by Mexican president Felipe Calderon and fully supported by the National Tourist Business Council and all of its affiliated organizations. This measure, which may seem to be an emergency response to a lingering crisis, is actually a decision long awaited and applauded by the tourist industry and all the economic sectors it affects, because its intent is to revitalize what is still one of Mexico's biggest strengths, and perhaps one that is used less than its full potential: tourism. We in the business world are optimistic about this endeavor, which focuses on reviving and advertising to the world one of the most complete tourist inventories in the plant. This was described in a recent Ministry of Tourism Bulletin as one of vast human and geographic wealth: more than three thousand years of history, home to fascinating archaeological treasures, more than 30,000 sites, 40 "Magic Villages," ten circuits that connect the entire country, a wide choice of colonial cities, one of the most biodiverse geographies in the world, many of its best beaches, more spas than any other country, and ranking second in luxury tourism (Sectur Bulletin 042, 16 March 2011).
Sustainability: An Investment in the Future Under current conditions, with invaluable wealth available to domestic and international travelers, and with tourism raised to levels of state policy through the recentlysigned National Agreement for Tourism, it is inevitable to think that the doors are more open than ever for investment to flow into the industry. But this opening must impose conditions on both parties: the government and investors.
On the part of government, new regulations and laws are needed to simplify administration, eliminate unnecessary red tape and create incentives for local and foreign investment. A priority must also be placed on combating on all fronts necessary the image of crime and violence, because it hurts not only the tourist industry but all the productive sectors of the economy and society itself. As for the tourist industry, it is clear that new rules are needed on social cooperation and environmental care. It is time to return to the basic thesis of the U.N. World Commission on Environment and Development, when in 1983, alarmed by the consequences of human activity on the environment, defined sustainable tourism as "that which seeks to improve the quality of human life without exceeding the carrying capacity of the ecosystems that sustain it." Unfortunately, the work of this Commission has not yet translated into substantial practical advances, although it did provide the definition later adopted by the World Tourism Organization: "Sustainable Tourism is Tourism that meets the needs of present tourists and host regions while protecting and enhancing opportunity for the future." It is conceived as a path for managing all resources in a way that meets economic, social and aesthetic needs while respecting cultural integrity, essential environmental processes, biological diversity, and the systems that sustain life. (For more information, go to http://unwto.org.) Based on these rules set by the WTO, which enable us to view sustainable tourism as a new alternative for restoring and respecting the environment, combined with the integration of host communities into the economic and social development of tourist projects, investors can be sure that the return on their investment has the added value of working now for future generations.
Juan Bremer is Founding Partner and CEO of RLD, and has more than seven years of managerial and directorial experience. He has a solid track record as director of real estate projects, a business he started out in by remodeling homes in Mexico City. In 2001 he founded Zen Arquitectura, and after that he took part in the project that gave rise to RLD, called "Cabezas", developed in Jalisco. He studied Marketing and Communication in the Wesdeutsche Academy for Communication in Cologne, Germany, and the company he heads today develops sustainable tourism projects in the states of Jalisco, Nayarit and Baja California Sur.
20
NOTITUR
Statistics
Golf Resorts in Mexico:
a Booming segment of the Tourist Industry By Omar Chárraga
Mexico has around 200 golf courses, and comparing this to the 20,000 courses that exist in the United States--with due regard to the different proportions between the two in terms of territory size--we can clearly see that we are faced with a huge opportunity for urban and tourist development based on this popular type of attraction.
Omar Chárraga is Director of Residential Tourist Homes for Softec. He has an undergraduate degree in Business Administration from the Faculty of Accounting and Administration of Universidad Nacional Autónoma de México, and a Master's Degree in Marketing from the Instituto Tecnológico de Estudios Superiores de Monterrey. He has been Marketing Manager of KPMG and Promotion Supervisor for Procter & Gamble. He has served as project leader in 300 consultancy projects, spoken at exhibitions, and been instructor and trainer for 20 construction firms throughout Mexico. Among other activities, in his current position he has analyzed residential tourist real-estate, urban housing, shopping centers, offices and industrial bay projects. He has also authored various articles published in newspapers like Reforma, Excelsior and El Economista, and in journals such as Expansión, Mundo Ejecutivo, Real Estate and Metros Cúbicos. He is also the author of the DIME of publication series on Vallarta, Los Cabos, La Paz, Puerto Peñasco, San Carlos and Huatulco. Contact: omar@softec.com.mx Tel. (55) 5063 8828
22
NOTITUR
Tourist Resorts with Golf Courses Typically, a golf course requires an area of at least 75 hectares, which when combined with other components like residential lots and sometimes hotels and other amenities lead to resorts that can cover an average of 300 hectares. They have the dual appeal of being social clubs as well as sports facilities, in which sports and health activities can be carried out; they may include spas and beauty clinics, substantially enhancing the services supplied in the tourist resort. As for costs, the typical "green fee" for a weekend is around $150 US dollars; an average share in a golf club costs $30,000 US dollars; and the monthly maintenance fee is about 20,000 Mexican pesos. In this price range, golf courses normally offer the following amenities and services: • Clubhouse • Restaurants, coffee shops and bars • Spa and fitness center • Kids' club • Golf, swimming, tennis and paddle classes; gym and horseback riding • Some have a marina • Golf pro shop • Convention facilities • Game room • Locker rooms with sauna and Turkish bath • Convenience store • Chapel • Security Today, it is nearly impossible for a golf course to be created in isolation, since the concept has evolved to one of perfect symbiosis with real-estate and/or hotel properties. It is also clear that urbanized lots and homes within a golf club have greater value--the price per square meter is between 20 and 50 percent higher than for those without one. In conclusion, residential tourist developments have a huge market niche open to them in golf resorts, particularly if they develop concepts less oriented toward status symbols and more toward sports, and are conceived more as integrally-planned communities than elite social clubs. This is because there is a whole new segment of families in the AB and C+ brackets that are taking steps to attain this level of real-estate product, and may be served with golf courses designed in accordance with their tastes and preferences. The table showing on page 24 lists some of the golf courses in Mexico that are most widely recognized for their services and modern amenities, located in some of the country's most popular beach destinations. The listing includes the year they were founded; those highlighted in color are the most recent, or those that are in the process of being built.
Statistics
Most widely recognized golf courses in Mexican major tourist beach destinations.
24
NOTITUR
Holes
Designer
Club de Golf Acapulco
Name Acapulco
City
1950
Year Created
9
Percy Clifford
Club de Golf Acapulco Princess
Acapulco
1971
18
Ted Robinson
Mayan Resort Golf Acapulco
Acapulco
1993
18
Pedro Guereca
Tres Vidas
Acapulco
1995
18
Robert Von Hagge
Pierre Marqués Golf Club
Acapulco
2004
18
Robert Trent Jones Jr. y Percy Clifford
Campo de Golf Pok-Ta-Pok
Cancún - Riviera Maya
1977
18
Robert Trent Jones Jr
Golf Puerto Aventuras
Cancún - Riviera Maya
1987
18
Thomas Leman
Ceasar Park Golf Club
Cancún - Riviera Maya
1995
18
Robert Trent Jones Jr
Club de Golf Meliá
Cancún - Riviera Maya
1998
9
N/A
El Camaleón Mayacoba
Cancún - Riviera Maya
2004
18
Greg Norman
Club de Golf Playa Mujeres
Cancún - Riviera Maya
2006
18
Greg Norman
Puerto Cancún
Cancún - Riviera Maya
2008
18
Tom Weiskopf
Campo de Golf Grand Coral
Cancún - Riviera Maya
2011
18
Nick Price
Chac-Ha-Lal 25 Golf Club
Cancún - Riviera Maya
N/A
9
N/A
Club de Golf Playacar
Cancún - Riviera Maya
N/A
18
Robert Von Hagge
Club de Golf Marina Ixtapa
Ixtapa- Zihuatanejo
1994
18
Robert Von Hagge
Club de Golf Palma Real
Ixtapa- Zihuatanejo
N/A
18
Robert Trent Jones Jr
One & Only Palmilla
Los Cabos
1993
27
Jack Nicklaus
Raven Golf Club at Cabo San Lucas
Los Cabos
1995
18
Pete Dye
Cabo Real Meliá
Los Cabos
1999
18
Trent Jones Jr
Club de Golf Querencia
Los Cabos
2000
18
Tom Fazio
Cabo del Sol Desert
Los Cabos
2002
18
Tom Weiskopf
Cabo del Sol Ocean
Los Cabos
2003
18
Jack Nicklaus
Punta Sur Mayan Los Cabos
Los Cabos
2004
9
Mario Schjetnan
Club de Golf San José del Cabo (FONATUR)
Los Cabos
2005
18
Cary Bickler
Club Campestre San José
Los Cabos
2007
18
Nicklaus Desing
Quivira Los Cabos (Cabo Pacífica)
Los Cabos
2009
36
Jack Nicklaus
Puerto Los Cabos
Los Cabos
2009
18
Jack Nicklaus / Greg Norman
Club de Golf Diamante
Los Cabos
2009
18
David Love
Cabo Riviera Golf Course
Los Cabos
Under Construction
18
Pete Dye
Chileno Bay
Los Cabos
In Planning Phase
18
Tom Fazio
Campo de Golf El Dorado
Los Cabos
N/A
18
Jack Nicklaus
Flamingos Nuevo Vallarta
Vallarta y Bahía de Banderas
1978
18
Percy Clifford
Club de Golf Marina Vallarta
Vallarta y Bahía de Banderas
1988
18
Joe Finger
Four Seasons Resort and Golf Course
Vallarta y Bahía de Banderas
1996
18
Jack Nicklaus
El Tigre Paradise Village
Vallarta y Bahía de Banderas
2001
18
Von Hagge, Smeleky, Baril
Mayan Palace Vallarta
Vallarta y Bahía de Banderas
2001
18
Jim Lipe
Vista Vallarta Nicklaus
Vallarta y Bahía de Banderas
2001
18
Jack Nicklaus
Vista Vallarta Weiskopf
Vallarta y Bahía de Banderas
2001
18
Tom Weiskopf
Club de Golf Litibú
Vallarta y Bahía de Banderas
2010
18
Greg Norman
Club de Golf Nahuí (in Destiladeras)
Vallarta y Bahía de Banderas
Under Construction
36
Rees Jones
Club de Golf El Capomo
Vallarta y Bahía de Banderas
In Planning Phase
18