Great Hotels Organisation (GHO) predicts South America becoming the next big thing in luxury hotel and exotic travel-seeking Europeans as a result of economic slow downs in Europe.

“We have seen the way tourism in Asia has grown and we expect the same thing will happen with South America. As flight times and costs are similar to Asia, people will be more open to searching for new experiences and cultures that are unique to this diverse continent” - Chris Paton, Regional Manager of Business Development at GHO.

The economic imbalances in Europe and North America have changed consumers habits and appetites for travel, including an a more demanding set of expectations from luxury providers.

The Uruguayan city of Punta Del Este is a prime example of this change. On a continent once reputed to be best for backpackers and adventure types,  this small coastal city has become famous and is now home to a thriving summer culture populated by affluent travelers and celebrities.

Carly Gotz comments “The demand for luxurious properties in new destinations such as Argentina, Peru and Brazil has prompted us to expand our portfolio to this area. We have recognised the importance of this market and are offering new services to members such as South American MICE roadshows. Our first roadshow in this market will be held in Sao Paolo next month and provides our members with a full five day schedule of appointments with A-list meeting planners. We look forward to working with this exciting market”.

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After the $700 Billion bail-out proposal was shot down in the House of Representatives on Monday, Hotel companies’ stocks were among those that took a dive in the biggest dive in two decades.

With the turmoil not subsiding, the outlook for the 2009 travel season has become even gloomier than previous forecasters thought, which added to the punch suffered by hotel stocks.

Goldman Sachs analyst Steven Kent said revenue per available room (RevPAR) in the US Hotels to remain negative well into 2009.

“We think shares will continue to grind lower in the coming months, but we acknowledge that given the past 12 months underperformance it will be more of a slow drip rather than a sharp, rapid decline,” Mr Kent said.

Starwood Hotels & Resorts Worldwide Inc., Morgans Hotel Group Co. and Orient-Express Hotels Ltd. were among those with the steepest declines following the House vote.

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