Transat buys land for first resort in Mexico

MONTREAL • Transat A.T. has taken its first concrete step toward getting shovels in the sand on its $750-million plan to develop a hotel chain in the Riviera Maya and the Caribbean, announcing a deal Tuesday to buy land on Mexico’s Yucatan Peninsula.

The Montreal-based travel company said it aims to build a beach resort on a newly purchased lot in the village of Puerto Morelos — less than 40 kilometres from Cancun — and on an adjacent property, for which it has signed a promissory agreement.

The combined deal would cost between US$54 million and US$57 million, Transat said.

Chief executive JeanMarc Eustache has said he plans to spend his final year or so with the company he co-founded in 1987 putting together a network of hotels he hopes will better position the holiday tour operator against heightened competition from Canadian rivals.

“Our company’s future growth will be built on hotel development and, obviously, the strength of our leisure travel business,” Eustache said in a release.

The company, under the watch of his replacement and chief operating officer Annick Guerard, said it hopes to own or manage 5,000 rooms in Mexico and the Caribbean by 2024.

Construction is expected to start between seven and nine months from now, with an opening date of winter 2020-21.