The protests in Chile over increased fares for the Santiago Metro subway, the increased cost of living, privatization and overall inequality have been ongoing for more than a month now, and analysts at STR blame the unrest for a decline in the country’s hotel occupancy during the last two weeks of October.
The occupancy drop, which became most noticeable the day after a government curfew was instituted on October 20, pushed Chile’s occupancy down 10.5 percent for the month.
The country’s absolute occupancy level was the lowest for any October in STR’s Chile database at 58.8 percent.
Based on year-over-year comparisons, October 24 was Chile’s worst occupancy day with a 50.8 percent drop in the metric. In absolute terms, occupancy reached as low as 30.3 percent on October 30.
Those results, the report claimed, were largely a result of performance in the capital city of Santiago, where hotels reported 11 consecutive days of double-digit occupancy decreases—the worst coming on October 24, with a 45.7 percent drop. Occupancy in the country’s key hotel market fell to as low as 31.4 percent on October 30.
“Santiago was already facing a challenging year with a healthy amount of new supply and less demand from neighboring Argentina,” said Patricia Boo, STR’s area director for Central/South America. “The situation has been made even more difficult because of the instability in the country. Fortunately to this point, hoteliers have been able to hold room rates steady to lessen the impact on revenue per available room. That pricing confidence will continued to be tested with such little demand in the marketplace.”
While performance has fallen in most of the country, it is worth noting the STR-defined submarket for Santiago International Airport and its surrounding area reported a performance increase near the end of the month, with occupancy up as much as 40.4 percent to 72.1 percent on October 28. Boo attributes that growth to the area’s distance from the primary protests as well as flight disruptions forcing travelers to seek overnight accommodation.