Investors - Invest in accommodation for students in Buenos Aires, Argentina

Are you interested in investing in academic tourism in Argentina?

Investing in hotellerie in Argentina is an excellent business opportunity. In fact, it is one of the few industries with the fundamentals for continued growth and increasing returns on investments in the medium and long term. It is strong on both the supply and the demand sides.

This being the case, there are various niches in the tourism spectrum. Among them is academic tourism, which is in a phase of rapid growth and development in the region.

We understand academic tourism to include foreigners' visiting Argentina to study everything from graduate and undergraduate degrees to study abroad programs, language programs and tango.

The growth rate of academic tourism in the last few years rose by 45% (between 2007 and 2009). The goal for 2013 is to attract 15% of the world's students, according to INPROTUR, the government agency responsible for promoting Argentina abroad. It is run by the National Tourism Secretariat, headed by Enrique Meyer.

By the end of 2009, academic tourism generated more than 80 million dollars of revenue for Argentina.

According to Mr. Leonardo Boto, Executive Director of the National Institute for the Promotion of Tourism (INPROTUR), students stay up to four years in the case of an undergraduate degree or as little as one month in the case of language studies. In this case, instead of staying in hostels, many students opt for furnished apartments.

In fact, many rental agencies now specialize in offering all-inclusive apartments close to educational institutions. It is also worth mentioning that family and friends frequently come visit them, which constitutes a "very interesting economic movement."

How do you account for the growth of academic tourism in Argentina?

Emerging countries are seen as new destinations for academic and professional development, keeping in mind the latest world changes. These days, there are more opportunities in Latin America than in the United States or Europe.

The growth of tourism in Argentina highlights its role as a cultural destination in the region, which in turn boosts the academic sector.

A joint effort by the public and private sectors to promote the country as an academic destination in fairs like those in São Paolo and Frankfurt--even working with universities, such as in the production of the book "Study in Argentina 2010, bicentennial edition".

Experts predict that by 2050 there will be more than 530 million Spanish speakers worldwide, 100 million of which will be living in the US. This phenomenon translates into a huge migration of Americans hoping to learn the language.

The ratio of cost to educational quality in Argentina is very favorable compared the Mexico and Spain, countries which share the academic market.

Buenos Aires as an educational and cultural center for Spanish language learning.

Academic possibilities also present strong opportunities for growth and increased profitability in local industries:

The local industry is composed of hostels, homestays and student dorms, all with outdated and inefficient management practices. There is a great opportunity to channel this potential business into shared, managed apartments, which we call condo-dorms.

The rental rates of shared, managed apartments are equally competitive as the rest of the competition, while offering advantages the others lack.

Basically, in the same way condo-hotels are a unique model, the academic niche is unique within the tourism industry as a whole. How can I invest in the academic housing market?

Services offered by DormsBA:

Investing in this sector, as with any investment, requires a working knowledge of the subject from various viewpoints.

  • »Management
  • »Online marketing
  • »Development (architecture and furnishing)

DormsBA -in these areas- offers everything that's needed in this extense investment model.

Business evaluation & Planning

An interesting aspect of the academic market, as opposed to the tourist sector, is the diversity of locations. They are largely located in residential neighborhoods or those surrounding universities instead of the tourist areas of Buenos Aires.
Thusly, the business can be understood as an opportunity beyond that of high-cost land and properties.
Investment opportunities are constantly cropping up, be they apartments, properties or land, as the case may be.

The business plan varies on a case-by-case basis, but in all cases, the DormsBA team creates a business plan including projected profits, administrative costs and costs to the proprietor based on our previous development experience.

We also offer a quote for the branding of the property vis-à-vis architecture, design, furnishing and services.

In short, it is a partnership with the investor in which each side fully understands its contractual responsibilities depending on the particulars and scale of the project in question.

What is a condo-dorm?

In order to understand the model, it is helpful to base our understanding on the concept of a condo-hotel. It is worth mentioning that in our line of work, a similar concept has existed for a long time--that of the apart-hotel, which is basically a building of urban apartments, subdivided in the usual way, that offer services typical of hotels. In general, each unit is rented separately.

Traditionally, the apart-hotel market in Buenos Aires was dominated by Argentines that lived in the interior of the country that would come to the city for long periods and preferred to stay in apartments instead of hotels. Another upside to this arrangement, other than the generally superior upkeep and services afforded, was that in the periods during which they were not in the city, they could rent the apartments out.

Apart-hotels have larger rooms than typical hotels, as well as a small kitchen. As far as services go, apart-hotels offer better services than a traditional apartment, while not at the level of hotels. Condo-dorms are basically the same model as condo-hotels, but with the common services necessary to serve the public that would prefer such a housing model.

The main difference between a condo-hotel and a condo-dorm is the use of the units themselves, since the group of apartments takes the form of a traditional horizontal property.

The idea of "strategically fusing" the units depending on the number of travellers is where the condo-dorm model differs.

Operation and Management (condo-dorm model)

Once the condo-dorm is up and running, the day-to-day functioning is similar to that of a hotel.
Each investor signs, along with the deed, a contract with DormsBA, in which the owner's rights to access are detailed along with the percentages of the gains to be allotted to both parties--a value in US dollars based on the going market value. The simplicity of this operational setup is another attractive facet of the business arrangement.

Benefits of this model

Higher profitability

  • »Better locations and more space yield higher rents.
  • »Optimization based on the centralization of administrative tasks.

Better quality of service

  • »Bilingual and multicultural team to better meet the needs of the client.
  • »Experience and operational know-how with experience in the Spanish market (Madrid, Barcelona)

More deals

  • »Growing demand via search engines and our electronic outlets.
  • »Affiliate presence and strategic partnerships with foreign universities.