Investing in Hospitality – The Recovering Tourism Sector

With unemployment still a problem in America and families skipping vacations in order to save money, tourism may not seem like a sure bet in the investment world, but investing in hospitality technology and foreign opportunities may be a great way for any investor to diversify a portfolio. Even as tourism may be taking a hit here at home, some areas abroad are flourishing. As of November 2011, tourism in India has enjoyed a resilient phase of prosperous growth. Foreign tourists are traveling to India and spending money, and it’s becoming a major international destination for people all over the globe. This equates to a lucrative hospitality sector that many American investors are looking into.

India’s middle class has grown tremendously over the years, and this is the main group driving tourism in any country. India has welcome IT jobs thanks to outsourcing and plenty of foreigners are making India their stop for business trips. Recent government initiatives have made travel in India easier, especially since tourists from countries like Singapore, Japan, Finland, and Luxembourg now have access to special tourist visas. There has also been an increase in medical tourism since foreigners are finding health services in India to be more accessible than in their own countries.

Aside from foreign investments, investing in hospitality here at home could prove to be fruitful, even in the wake of the recession. Like most other major tourist countries, the United States boasts an industry in which accommodations, food and beverage, and other aspects make up this huge business. Researching individual hotel chains, food services, and even hotel suppliers may be a good way to break into the hospitality sector. As unemployment levels off and jobs are brought back to America, tourism will once again pick up and investors who get in it now will have purchased stocks and other investment products at less expensive prices.

After the hotel industry virtually imploded for two straight years, the industry managed to pick back up in late 2010 and is only expected to grow once again. Even so, investors could face risks with hotels and lodging companies that are facing debt restructuring and even bankruptcy, but any hotel chain that was suffering under the short-term loans and rock-bottom room prices would have already succumbed to the devastated economy. Those left are slated to thrive. It may be a while before investors start to see a high rate of return on their investments, but hospitality is one sector that has no place to go but up.

About Richard Wilson

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