I recently spoke with Diego Lowenstein, a hotel developer with an interesting take on the evolution of the all-inclusive resort.
Lowenstein is head of the 50-year-old, Miami-based Lionstone Development, a company with a portfolio of properties, four of which are in the Caribbean in Aruba and Curacao. While only one of the four, the Sunscape Curacao, is an all-inclusive, he's studied the business models of many properties long enough to see all-inclusives "shift from a standardized 'cookie-cutter' experience to a more personalized, localized experience."
"Today's all-inclusive resorts are changing the way people think of the all-inclusive experience," he told me. "From high-end dining and expanded activity offerings to superior service and stunning design, the new wave of luxury resorts is not your grandparents' all-inclusive."
Customer trends and changes are shaping the new wave of all-inclusives, changing the product and making it more competitive, he said.
"Years ago, there was a gap between traditional resorts and luxury resorts," he said. "Today's upmarket resorts compete with the higher tier of the luxury market in all categories, from service standards to food and beverage offerings in all segments of the market, from family-friendly and couples to lifestyle resorts."
He cited the cruise product as opening the potential for the rise of the land-based all-inclusives: "Going on a cruise is like staying at an all-inclusive. Many first-time travelers go on a cruise and opt to follow up with a similar experience at all-inclusive resort."
Consumer demand is driving the growth of the all-inclusive sector, "and a savvy developer/investor/owner must understand customers' needs and recognize that all-inclusive resorts require payment of more taxes due to higher revenues, more staff than in a traditional property," Lowenstein said. "But there is a great benefit from a labor standpoint. A young staff has more opportunities to grow within the company and eventually move up the corporate ladder."
He acknowledged that all-inclusives often are criticized for not contributing to the local community.
"This comes primarily from restaurants, but that's a disproven premise," he said. "People are not locked in for seven days. Most guests go out to explore the destination on tours or in rental cars, eat at local restaurants two or three times. Already the all-inclusive has driven up employment in the immediate area."
As for Lionstone's development landscape in the Caribbean, the company is keen on continuing to grow in the region by assisting as developers with multiple hotel sites. Lowenstein sees growth in the all-inclusive sector for the company in Mexico, Jamaica and the Dominican Republic, which he described as "an amazing success story and in the forefront of growth in the all-inclusive market."
Outside of the Caribbean, he said that other potential markets include Asia. "The all-inclusive market will open up in a big way there as it will in Brazil, Costa Rica, Nicaragua and Panama."