The multi-billion dollar medical travel sector could become an important new source of demand when traditional demand drivers are under increasing threat.
According to Jones Lang LaSalle Hotels' most recent research FocusOn Medical Travel - fad or focus for hotel operators and investors?, the medical travel sector has potential to develop into a lucrative niche market for hotel operators and investors.
The medical travel industry is driven today by Asia, particularly popular destinations such as Thailand, Singapore, Malaysia and India. 'These countries are developing first-class facilities with highly skilled medical specialists, many of whom trained abroad,' said Mark Wynne Smith, CEO for Europe, Middle East & Africa at Jones Lang LaSalle Hotels. He added, 'International tourists are attracted by the high-quality and relatively low-cost healthcare offered.' With destinations such as Eastern Europe, Turkey and Dubai getting in on the act, this market is poised for rapid expansion in the future.
As travellers become more discriminating, they will continue to seek out hotels and resorts that offer a complete array of amenities. Medical spas, medical travel and rehabilitation at desirable destinations will play a large role in the new generation of spa resorts. 'In Dubai alone, there are at least 120 spas, health clubs and clinics offering wellness services. By 2015, the United Arab Emirates could be amongst the top spa destinations in the world with an estimated 200 hotels offering world-class facilities,' said Mark Wynne Smith.
Stakeholders must ensure that the medical travel industry offers accessible, affordable and high-quality care to cement the reputation of this fledgling sector and allow the travelling public to make informed choices about their medical care. There is enormous potential for partnerships between hotel chains, property developers, airlines, insurance companies and financial institutions. 'These partnerships are vital as medical travellers need the security and peace of mind provided by purchasing an all-inclusive package for their trip,' said Wynne Smith.
'Medical Tourism has the potential to become a significant tourism segment with investment opportunities ranging from large scale hotel developments adjacent to city hospitals or specialist offerings with some minor modifications to existing product. In either scenario, the amount of incremental capital expenditure will depend on the size and opportunity within the market and should be a key consideration for any investor,' concludes Mark Wynne Smith.
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Jones Lang LaSalle Hotels, the first and leading global hotel investment services firm, is uniquely positioned to provide both the depth and breadth of advice required by hotel investors and hotel companies, through a robust and integrated local network. In 2007, Jones Lang LaSalle Hotels provided sale and purchase advice on 259 hotel transactions globally, representing a combined value of US$13.9 billion, a total of 54,763 hotel rooms in 84 cities. In addition advisory and valuation services were provided on 660 assignments globally for 182,048 rooms across more than 300 cities.
The global team comprises over 270 hotel specialists, operating from 31 offices in 18 countries. The firm's advice is supported by a dedicated global research team, which produced over 45 publications in 2007 in addition to client research. Jones Lang LaSalle Hotels' services span the hospitality spectrum, from luxury single assets and large portfolios to select service and budget hotels, resorts and pubs. Their services include investment sales, mergers and acquisitions, capital raising, valuation and appraisal, asset management, strategic planning, operator selection, management contract negotiation, consulting, industry research and project development services. Jones Lang LaSalle Hotels' clients have access to the resources of its parent company, Jones Lang LaSalle (NYSE: JLL). www.joneslanglasallehotels.com