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Better Times for Argentine Hoteliers
Seis Continentes / Fall 2000

By Larry Luxner

BUENOS AIRES -- For about a month last year, the president-elect of Argentina, Fernando de la Rua, ran his transitional government from the 19th floor of the Crowne Plaza Panamericano in downtown Buenos Aires.

"De la Rua used four floors of this hotel as a headquarters for his campaign over election weekend," recalls Marcelo Ubach, general manager of the property. "We had CNN here, as well as TV channels from Chile, Brazil and Germany, and about 200 computers set up in the press room. On Sunday, Oct. 24, he was elected president, and from then until Dec. 10, when he assumed office, his staff occupied the 19th and 20th floors of the hotel."

Since then, things have quieted down at the Crowne Plaza Panamericano, though Ubach certainly has plenty to keep him busy.

The hotel now has 400 rooms, up from 200, thanks to the inauguration of the 28-story North Tower in November 1998 (the older South Tower has 22 stories). Ubach, who has been general manager here since late 1992, says the expansion represented a $50 million investment on the part of Panatel S.A., which owns this hotel as well as the five-star Hotel Panamericano Bariloche, a 306-room ski resort in Argentina's Andes Mountains.

A promotional pamphlet says the renovated property "combines luxury and beauty with the early-century architectural style that made Buenos Aires famous. We are convinced that its exquisite combination of class furniture, fine colors and other singular elements of decoration will give a unique feel to your stay with us."

Indeed, all rooms have views of either the Río de la Plata or busy Avenida 9 de Julio, one of the widest boulevards in the world. Le Mirage, an indoor pool and fitness center on the 23rd floor of the North Tower, is an ideal place from which to photograph the famous Obelisco, Argentina's equivalent of the Washington Monument and a national symbol.

Following the renovation, the Crowne Plaza Buenos Aires has 14 new meeting rooms able to fit between 30 and 1,000 people each; the Gran Salón Panamericano alone has a 560-square-meter area as well as a 360-square-meter foyer.

Although the hotel was inaugurated in 1981, it's been known as the Crowne Plaza Panamericano since October 1993. Ubach arrived a year before that, having spent the previous 12 years running his own tourism company.

"We're on a plateau -- not growing, not shrinking," says the 43-year-old Ubach, originally from Bahia Blanca in southern Buenos Aires province. "It's no secret that in the last few years, many hotels have opened, but at the moment, the market is stable."

Ubach said the Crowne Plaza's occupancy rate varies between 65% and 68%, that 80% of his guests are executives -- mainly Americans and Europeans -- and that its strongest competitors are the Hyatt, the Caesar Park and the Alvear Palace.

Things appear a little more encouraging at the 315-room Inter-Continental Buenos Aires, where occupancy stands at 78%, according to general manager Aureliano Vignatti. About 45% of Vignatti's guests are Americans, 25% Latins, 25% Europeans and 5% from the rest of the world.

"Many new hotels have opened here, so there's a lot of competition. In Buenos Aires, there are about 3,700 rooms in four- and five-star hotels," says Vignatti, who came here in February 1994, about a year before the hotel opened for business.

"Business has been slow, though there's finally some indication that the economy is recuperating. The GDP has started picking up a little bit," he said. "This is also due not only to the recession, but to the effects of last year's devaluation in Brazil. Very few Brazilians have come here on vacation, because the exchange rate has not been favorable to them. Obviously, it's much more expensive now for them to come to Argentina, so they're better off going somewhere within Brazil."

The Hotel Inter-Continental Buenos Aires, which employs 270 people and represents a $62 million investment, is owned by IRSA, a real-estate conglomerate controlled by Eduardo and Fernando Elsztain.

Vignatti said it's unlikely that the Inter-Continental chain will expand in Argentina given current economic conditions.

"Any expansion would be based on a management agreement rather than an investment," he said. "Some time ago we were offered the opportunity to manage a hotel in Montevideo, Uruguay, but we decided not to."

One thing that does interest Vignatti is the Premio Nacional de la Calidad, a prestigious award given by the Argentine government every year since 1994 to companies that excel in their respective fields.

"Only six companies have received it so far, including Xerox, YPF Lubricantes and Lautrec, an advertising company," said Vignatti. "They've demonstrated that they know how to maintain and assure total quality in their activities. We hope this year we'll be recognized too."

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