A new luxury hotel will soon open in Punta Carretas, the most expensive neighborhood per square meter in Montevideo and no stranger to new hotel construction in recent years.

The Oliva Luxury will be a 30-key, five-star boutique hotel with guest amenities including a restaurant, spa, fitness center, conference room, coffee shop and cigar lounge, according to El Pais. The project was originally announced in 2012 and scheduled to open in October 2013. The new timetable should mean a 2015 opening.

When it opens to the public, the Oliva will have no shortage of competition for hotel guests in Punta Carretas. The 207-room Sheraton Montevideo is the most high-profile luxury hotel in the barrio, the 249-room Dazzler Montevideo just opened this year, the 74-suite InterCity Premium is a TripAdvisor award winner, and Starwood plans to open a 125-key Aloft Montevideo next year.

While Montevideo real estate prices have fallen over the past 24 months in most neighborhoods thanks to a construction boom and oversupply of small units, the high cost of land in Punta Carretas has limited new construction to a few luxury hotels and high-rise condominiums.

Real estate prices remain firm in both Punta Carretas’ office and residential sectors, but the glut of new hotels is beginning to put pressure on Punta Carretas hotel prices. A quick search on Expedia shows rooms under US$100/night in more than one high-end hotel. It’s good news for travelers, but hotel developers need to be cognizant of current and future room inventory in a capital city with no major expo and convention center. (Full Story in Spanish)

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