Each week, HotelNewsNow.com features a news roundup from a different global region. Today’s roundup covers the Asia/Pacific region.
Regional hotel supply
The Asia/Pacific hotel development pipeline comprises 1,638 hotels totaling 375,078 rooms, according to the August 2012 STR Global Construction Pipeline Report. STR Global is a sister company to HotelNewsNow.com.
Among the region’s markets, Shanghai ended the month with the largest number of rooms in the total active pipeline with 12,721 rooms. Five other markets reported more than 5,000 rooms in the total active pipeline: New Delhi (11,856 rooms); Bali, Indonesia (8,671 rooms); Jakarta, Indonesia (7,121 rooms); Manila, Philippines (6,438 rooms); and Beijing (6,134 rooms).
Asia/Pacific hotel performance
Hotels in the Asia/Pacific region experienced mixed results in the three key performance metrics for August 2012 when reported in U.S. dollars, according to data compiled by STR Global.
In year-over-year measurements, the Asia/Pacific region’s occupancy ended the month virtually flat with a 0.1% decrease to 68.1%, its average daily rate rose 0.7% to $139.49 and its revenue per available room was up 0.7% to $95.01.
2012’s largest hotel opens in Macau
At nearly 4,000 rooms, the Sheraton Macao Hotel is the largest hotel in Starwood Hotels & Resorts Worldwide’s global portfolio and the largest hotel to open worldwide this year. Consisting of two towers overlooking the Cotai Strip development, the hotel is home to the world's largest Sheraton Club Lounge, a main ballroom the size of more than 11 basketball courts, more than 160,000 square feet of meeting space, three restaurants and three outdoor pools.
The Sheraton Macao Hotel is owned by Sands China Limited, a subsidiary of Las Vegas Sands Corporation. The parent company announced plans Thursday to invest at least $2.5 billion to build another Cotai resort, the company’s fifth in Macau, according to a Bloomberg report.
Las Vegas Sands will fund The Parisian with $1.5 billion in bank loans and $900 million to $1 billion in cash, COO Michael Leven said during a press briefing. The resort will include family-oriented facilities to lure middle-class gamblers from China. It will have a replica of the Eiffel Tower.
Number of business trip increase in Asia/Pac region
A recent survey from Accor showed the average executive in the Asia/Pacific region took approximately 10 trips during the first half of 2012 compared to six trips during the same period last year, according to a report on tourism-review.com.
The highest increase in volume was in Mainland China where executives took 17 business trips in the first half of this year compared to just nine trips in first half of 2011. The next highest increase was in India where executives took 13 business trips compared to just seven trips last year.
Singapore was the only country in the Asia/Pacific region that did not show any increase in 2012. The number of business trips executes took in Singapore was seven in the first half of 2012 and 2011. However, Singapore emerged as the most popular business destination in 2012 followed by Hong Kong and Thailand.
Big revenue-generating hotels in India report low growth
The biggest public, revenue-generating hotels in India have seen revenue growth of just 3.2% during the past several years, according to an analysis by The Hindu Business Line.
The low growth number was attributed to a slowdown in tourist arrivals as well as reduced spending by tourists. Also, profits fell by 56.3% between the 2006-2007 and 2011-2012 fiscal years, from 785 crore to 343 crore ($147 million to $64 million).
The analysis, which took place during the time period of 2006-2012, included East India Hotels; EIH Associates; Hotel Leela Ventures; Indian Hotels; Kamat Hotels India Limited; Oriental Hotels Limited; and Taj GVK Hotels. The companies comprise 74% of the industry’s revenue.
Accor: 60% of Asian travelers prefer global economy brands
The growing demand for international-standard, value-for-money economy hotels led Accor to commission the Asia Economy Hotels Research 2012, a study which surveyed business and leisure travelers from eight key markets in Asia to gather insights into the differing attitudes towards economy hotels.
According to the research, six in 10 travelers in Asia prefer global economy hotel brands to domestic brands and assign different “personalities” to them. Global brands were considered “stylish, high-class, reliable, attractive and energetic” compared to domestic brands, which tended to be viewed as “down-to-earth, practical, approachable and considerate.”
Beyond Beijing: Brands move into new territory
Approximately 170 Chinese cities have more than 1 million residents, but just four—Shanghai, Beijing, Guangzhou and Shenzhen—are considered first tier cities in terms of size and wealth, writes Helena Iveson for a HotelNewsNow.com report. Only 9% of the country’s population lives in these four markets, leaving what Jones Lang LaSalle defines as the “China50”—or the 50 second- and third-tier cities that will account for 12% of global economic growth during the next decade and will generate 6% of the world's output by 2020.
These cities are prime targets for hotel brands seeking to expand. According to JLL, the supply of globally branded hotels in these 50 cities grew by 19% between 2010 and 2011, compared to 10% in first-tier cities.
Performance numbers thus far suggest the investments were justified. During the first seven months of 2012, China’s hotel industry as a whole posted modest increases in average daily rate (+2%) and revenue per available room (+1.6%) in local currency, according to STR Global.
But in Dalian, a secondary market in the south of Liaoning province, ADR was up 8.7% and RevPAR increased 2.9% in local currency. Likewise, Tianjin in Northern China posted ADR and RevPAR gains of 2.5% and 12.8%, respectively.
Key transactions, openings
W Hotels Worldwide announced the opening of the first W Hotel in Singapore: the 240-room W Singapore—Sentosa Cove.
Hilton Worldwide signed an agreement with Allamanda Hotel Developments Limited for a new resort property in Mahe, Seychelles. The property will undergo a renovation program and will re-open as the DoubleTree by Hilton Seychelles-Allamanda Resort & Spa in December.
Accor surpassed 100,000 rooms in the Asia/Pacific region with the opening of the 550-room Ibis Hong Kong Central & Sheung Wan.
Hard Rock International announced the 280-room Hard Rock Hotel Shenzhen and 250-room Hard Rock Hotel Haikou in China, which are slated to open in 2015 in collaboration with Mission Hills Group.
Starwood announced the opening of the Sheraton Fuzhou Hotel in China. The 396-room property is owned by the Zhonggeng Group.
Wyndham Hotel Group announced agreements to manage four new hotels under the Wyndham Hotels and Resorts brand: The 210-room Wyndham Grand Sanya Haitang Bay; the 250-room Wyndham Hangzhou Binjiang; the 270-room Wyndham Anhui Huangshan; and the 290-room Wyndham Xuzhou Tongshan.
Compiled by Stephanie Wharton.