MercoPress. South Atlantic News Agency

Punta Arenas hotel industry in a bind.

Punta Arenas hotels are fully booked for December and January and the season has been described as “excellent”. This has had a positive impact on hostels, motels and bed and breakfast homes that meet the spill over demand.

And once again a controversy about hotel capacity and investments has erupted among Punta Arenas officials' optimism and the industry's more cautious approach.

Contrary to what has happened in Puerto Natales, Torres del Paine, and in Tierra del Fuego and Antarctica, hotel capacity in the capital of Magallanes remains virtually unchanged.

"I'm concerned that we keep promoting tourism and we then don't have appropriate accommodations for tourists. I think the number of tourists to Magallanes will keep increasing and I hope next year we'll have additional investments in the industry", said Punta Arenas mayor Juan Morano.

Arturo Ocampo from the Punta Arenas Owners association of hostels and lodging, indicated that the results of the recent APEC Tourism summit held last month in Punta Arenas will begin to be felt in two/three years times.

"We could then be facing a complicated scenario is we continue with the same number of beds and there's an increase in tourists", said Mr. Ocampo who admitted that "some passengers prefer the big hotels, and infrastructure will be needed".

However for Jorge Norambuena, a local tourism representative, "building new hotels is complicated. Sometimes the lack of beds is very specific and non constant".

"I think profit margins have to be very closely assessed since you might have a full house in high season, but what about the rest of the year?"

Mayor Morano's optimism is based on several interviews with local and outside investors who "are interested where, how and under what conditions can they build new hotels of expand current facilities".

"We must be more flexible at regional level, invest in infrastructure, and if we can manage a casino it would be something extraordinary for the city".

"I believe that in two years time we'll see the hotel capacity increased by 30%", forecasted Mayor Morano, who mentioned Holiday Inn Express and Argentine investors as some of the most interested in Punta Arenas and Puerto Williams.