In this week’s roundup of news from the Asia/Pacific region: Two Roads Hospitality’s plans for Asia; Chinese capital restrictions; deals and developments; and more.
Hotel News Now each week features a news roundup from a different region of the world. Today’s review covers the Asia/Pacific region.
Asia a key market for Two Roads’ growth
Two Roads Hospitality sees Asia as a key market, writes Hotel New Now’s Stephanie Ricca, most notably through the expansion of its Singapore-based Alila Hotels & Resorts brand.
“Alila has great cache in Asia with the development and ownership community and guests,” said Two Roads CEO Jamie Sabatier. “Our pipeline there is extremely robust, not just with resort properties for Alila, but we’ll be opening city-center properties with Alila as well. We see growth of the brand in major urban markets, as well as a continued focus on the fabulous gateway resorts in Asia it’s known for.”
In the future, he said he sees “a big opportunity to bring our brands like Thompson, JDV, Destination and Tommie to Asia as well.”
Frasers Hospitality’s Choe eyes versatile global roster
Singapore-based Frasers Hospitality Group is working its way to achieving 30,000 units in its portfolio, writes HNN’s Jeff Higley, with only 8,000 left to go. CEO Choe Peng Sum explained his company will expand in markets where it’s currently operating, such as Europe, the Middle East, Asia and Australia while it looks for the right location in North America.
“We always try to buy around that six, seven o’clock in the property cycle,” he said. “We won’t try to hit it at that twelve o’clock cycle. We have put in strict yield hurdle rates that put in risk factors and some countries are good, but when the political scene is no good the risk shoots up. It’s a discipline because we use other people’s money as if it’s our own money.”
Chinese capital squeeze hits major hotel investors
The Chinese government’s concern over increasing levels of debt have led it to restrict the amount of overseas spending by Chinese companies, HNN’s Terence Baker reports. Earlier this summer, the government banned state-owned banks from providing further debt to Chinese firms and made it more difficult for companies to acquire overseas interest outside of the companies’ core industries and services.
That doesn’t mean, however, that the flow of Chinese capital into overseas business has stopped completely.
“It’s easy to say that a lot (of overseas investment) was opportunistic and less strategic, but I don’t think that’s the case overall,” said Jesper Palmqvist, area director for the Asia/Pacific at STR, who added that if Chinese overseas capital eased up, there would be plenty of other money ready to step in. STR is the parent company of HNN.
STR: Asia/Pacific hotel performance for July 2017
Hotels in the Asia/Pacific region reported positive results for July 2017, according to data from STR. Occupancy grew 3.8% to 74.4% and average daily rate grew 1.9% to $97.67, combining for an increase in revenue per available room of 5.7% to $72.66.
STR: Asia/Pacific hotel pipeline for July 2017
The Asia/Pacific region reported 626,535 rooms in 2,834 projects under contract, according to STR’s July 2017 Pipeline Report, a 7% year-over-year increase in rooms under contract. The region reported 276,757 rooms in 1,210 projects in construction for the month, an 8.3% year-over-year increase.
Shanghai, China, reported 9,737 rooms in 43 projects in construction. Jakarta, Indonesia, reported 5,715 rooms in 23 projects. Chengdu, China, reported 5,182 rooms in 23 projects.
Deals and developments
- Hilton’s Waldorf Astoria Hotels and Resorts plans to return to the Maldives in 2019 with the Waldorf Astoria Maldives Ithaafushi Resort.
- Thailand’s Minor Hotel Group entered into a $70-million joint venture with Cyprea Group to develop the 200-room Avani Fares Maldives Resort, set to open in the fourth quarter of 2019.
- Singaporean property developer Oxley Holdings obtained a temporary occupation permit to develop a 254-room Novotel and a 518-room Mercure.
- Spain-based Meliá Hotels International announced the opening of its first Innside by Meliá hotel in China, the 335-room Innside by Meliá Zhengzhou.
- AccorHotels announced the opening of the 99-room Mercure Dwarka in Dwarka, Gujarat, India.
Compiled by Bryan Wroten.