According to most headlines, current development trends would have you believe that the meat of hotel development these days is taking place in China and India, and while those are major growth centers for expansion one must not forget the countries at America’s borders. Case in point, Canada is also ripe for development, and is a location many international developers are already latching onto.
Forbes reported that one of Toronto’s biggest new projects, a 50-story luxury high rise, is being funded from foreign investors with ties to Watford Equity. At the same time, developers are currently building 97 residential towers in Canada. more than any other city in North America. These developers are attracted by Toronto’s visitor economy, and its available real estate in prime locations.
“The private equity that was injected was all foreign, predominantly from India, China and Israel. And of course the U.K., but the source of the U.K. money is really from India,” Harshal Dave, CEO of the Watford in Toronto, told Forbes.
A recent report from STR showed that the canadian hospitality industry is showing high occupancy numbers, increasing 2.6 percent to 76.0 percent in year-over-year comparisons for the week of June 7-13, 2015. Additionally, average daily rates for the country are up 6.9 percent to US$106.78, while revenue per available room is up 9.7 percent to US$97.28.
And development isn’t limited to the cities. In April, Red Roof Inn signed a 20-year deal with Canada to develop and brand 40 hotels across the country, with the first four properties planned to open by next year. All of these hotels will be new builds, and Red Roof partnered with independent Canadian developer and management company Pacrim Hospitality Services to support the plan. In addition, Pacrim partnered with Chinese investors to form Canada China Culture Hospitality Development operating as CCC Hospitality Development.
Lastly, while much of the travel industry is reeling from low oil prices, Canada is currently coming out a winner in the exchange. Most of all, Toronto is benefitting heavily by the low exchange rate, with occupancy reaching 74 percent, with Monique Rosszell, managing director with hotel appraisal firm HVS, telling The Mississauga News that the city is absorbing any and all new rooms that open up.
“There is double digit growth in many markets,” Rosszell said. “Overall, it is very positive.”