Tourism model needs revision to encourage more foreign investors to support new Bermuda hotels
Despite the popularity of Bermuda holidays the islands hotel industry is currently flagging. Sam Byrne, owner of Munro Beach in Bermuda, calls for a revision of the existing tourism model in order to attract foreign investment in Bermuda hotels.
Tourism officials in Bermuda recently announced a 12 per cent increase in the number of visitors to the island’s shores last year. Bermuda’s tourism minister Wayne Furbert, noted that the additional 70 000 visitors in 2011 when compared with 2010 represented the second highest number of visitors to the Caribbean island with 2007 being their most successful year to date. While this is an encouraging trend and indicative of the growing popularity of Bermuda holidays, much of the increased traffic to Bermuda has been driven by cruise ship arrivals.
A deeper analysis of the 2011 arrivals reveals that a mere 36 per cent of visitors arrived on Bermuda flights while 63 per cent were cruise ship passengers, a statistic which has had negative implications for Bermuda’s hotel industry. Fewer people stayed overnight at Bermuda hotels with a 0.9 per cent drop on that indicator, length of stay also displayed a negative trend reducing by 2.5 per cent from 6.21 nights in 2010 to 6.06 nights in 2011. Additionally, the number of hotel rooms and beds available also declined in 2011 with 292 fewer beds compared to 2010. The reduced accommodation for persons who book their holidays in Bermuda is in large part owed to a string of hotel closures which has been a cause for concern within Bermuda’s hotel industry.
Image by: worldtraveller5, on Flickr
Sam Byrne, US real estate investor and the owner of the spectacular Munro Beach has been observing the climate of Bermuda’s hospitality industry over the last 20 years. Mr Bryne explained in a recent interview that the under the current system the high cost of construction coupled with the heavy restrictions, taxes and fees placed on foreigners owning properties in Bermuda has chased away the foreign investors that the island needs in order to keep up with its peers across the region.
“Bermuda did not encourage ownership schemes, in fact prohibited them in most cases, and was too expensive for mid-market hotel operations to succeed…Thus, the bed base reduced, airlift declined and the overall industry suffered. The economy still succeeded with global business, particularly reinsurance, thriving in Bermuda, but the tourism market suffered to the point that it requires complete rebuilding from the ground up with new thinking and creative incentives to attract outside capital” Mr Bryne stated.
Image by: fairmont.hamilton, on Flickr
Currently travellers planning their Bermuda holidays experience are faced with limited accommodation choices with statistics showing that the number of hotel properties on the island has drastically reduced with only 48 hotels operating in 2011 compared to in excess of 100 in 1980. According to Mr Bryne, if the situation is to improve there needs to be more incentives for foreign investment in Bermuda’s hotel industry.
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