HotelNewsNow.com each week features a news roundup from a different region of the world. This week’s compilation covers Asia/Pacific.
During the opening session of the Australia, New Zealand & Pacific Hotel Industry Conference, global hotel leaders shared viewpoints on critical issues affecting hotel business.
One of the good things that came out of the economic maelstrom is owners and operators became closer and worked through the challenge together, said Jan Smits, CEO Asia Australasia, InterContinental Hotels Group.
“What we did was very thoughtful on how to reduce some of our costs,” he said. “We didn’t just take people out, because then in previous downturns we found we had to rebuild staff. We looked at brand standards with the owners. We sat down and tested relevancy with the customers—if not, we took them out.”
• Read “Leaders weigh in on financial crisis, innovation.”
Indicators bode well for Asia/Pacific
Australia has weathered the global financial crisis better than most, according to data presented at ANZPHIC.
Andrew McEvoy, managing director of Tourism Australia, said the country had 0.6% total share of global arrivals in 2009, which has been decreasing since 2000.
In the next year, however, tourism spending is forecast to grow 3% to AUD$92 billion, (US$80.8 billion) international arrivals to increase 4.3% to 5.8 million, and domestic overnight trips increasing 4% to 69 million, according to the Tourism Forecasting Committee of the Australian government.
Both overnight trips and visitor nights fell for a second consecutive year in 2009, down 6.3% and 5.6%, respectively.
The total number of available rooms increased 1.8% while the number of roomnights occupied (demand) fell 1.7% to 51.1 million roomnights, according to a May 2010 tourism update from the government.
• Read “Indicators say more Asia-Pac improvement.”
Onyx looks for more growth
It’s been a busy year of branding for Onyx Hospitality Group—or the company formerly known as Amari Hotels & Resorts.
The Bangkok-based hotel management company has reorganized its strategy (and name) around building a portfolio of 51 hotels by 2018 and expanding offshore, according to Peter Henley, president and CEO.
Onyx expects to sign its first Amari property in India in the next few months, he said.
The company has 17 properties total under management.
Luxury product Saffron Hotels Resorts and Residences, and select-service Ozo were announced in March. Onyx is building the first hotels for both new brands.
The company is building the first Saffron, which is due to open next year, in Bangkok.
• Read “Onyx looks beyond Amari to fuel growth.”
Ativa eyes controlled growth
Ativa Hospitality is feeling some of the effects of May’s “Red Shirt Riots” in Thailand, but co-founder and managing director Bill Black said the company’s growth plans are still in place.
The Bangkok-based boutique hotel-management company has seven hotels in its portfolio, which it plans to double, and—with its joint-venture partner Nadathur Group—will look to invest in hotels.
“We will always be a small company,” Black said during a telephone interview from his office in central Bangkok just blocks away from where the riots occurred. “You get to the number 12 and that’s a critical inflection point. At that point, you have to make a decision to go well beyond that number. Right now we’re strictly third-party (managers), but we’ll look at putting equity in certain properties.”
• Read “Ativa targets expansion opportunities.”
StayWell expands beyond Australia
For a hotel company that is four years young, StayWell Hospitality Group Pty Limited has made big strides in Australia. The next step in the company’s growth plan: Singapore and Dubai.
“Our aim was to secure a sound domestic footing, and now we’re moving into Asia,” said Richard Doyle, executive director of StayWell, during a break at ANZPHIC. “We acquired the land in 2007, and now we’re building our first hotel, our flagship (Park Regis) in the market.”
Another hotel under construction is the 392-room Park Regis Kris Kin Hotel, Dubai, which is due to open in October. The company also is developing the Leisure Inn Casablanca in Morocco. Doyle said they are close to announcing another location in Asia and two more in the Middle East.
• Read “StayWell expands beyond Australia.”
STR Global: Asia/Pacific pipeline for June 2010
The Asia/Pacific hotel development pipeline comprises 1,007 hotels totaling 252,969 rooms, according to the June 2010 STR Global Construction Pipeline Report.
China ended the month with 138,492 rooms in the total active pipeline, accounting for more than 50% of rooms in the total active pipeline among the countries of the region. India reported 46,360 rooms in the total active pipeline, followed by Thailand with 15,423 rooms.
Among the key markets, Shanghai, China, reported the largest number of rooms in the total active pipeline with 14,311. The market also ended the month with the most rooms in the In Construction phase with 11,592. Bangkok, Thailand, followed with 9,686 rooms in the total active pipeline and 5,599 rooms in the In Construction phase.
• Read “STR Global: Asia/Pacific pipeline for June 2010.”
Australia hotel deals pick up in first half 2010
The short-term investment strategy for Australia and New Zealand seems to be a “buy” sentiment, according to dealmakers on a panel at ANZPHIC.
Transaction volume for January to June is AUD$656 million (US$570 million), according to Craig Collins, managing director Australasia, Jones Lang LaSalle Hotels. This represents 85% of the total volume of 2009, he added.
“We will well exceed the (AUD)$1-billion (US$867.2 million) mark this year,” Collins said.
LaSalle Investment Management’s purchase of the Sofitel Sydney Wentworth for AUD$130 million (US$112.7 million) in May 2010 was one of the year’s notable transactions.
• Read “Australia hotel deals pick up in first half 2010.”
Barangaroo project brings hotel to Sydney harbor
Lend Lease was riding high on news it was granted control of the Barangaroo South project at ANZPHIC.
Barangaroo is an estimated AUD$6-billion (US$5.4-billion) partnership between the Barangaroo Delivery Authority, NSW Government and Lend Lease planned for Western Sydney on 22 hectares of land near the central business district on Darling Harbour.
David Rolls, Lend Lease’s CEO of development, said the company took control of development of Barangaroo South—a 7.5 hectare site with residential, commercial and public space. Plans for the site call for a 250-room luxury hotel, which is why Lend Lease attended the conference.
The proposed hotel is valued at AUD$250 million (US$225.3 million), and will be positioned on a new public pier. Investor and operator have yet to be decided, as the particulars of the project have not been approved by the NSW Government, but Rolls said they worked with several international hotel brands to conceptualize the project.
• Read “Barangaroo project brings hotel to Sydney harbor.”
STR Global: Asia/Pacific results for June 2010
Hotels in the Asia/Pacific region experienced increases in all three key performance metrics for June 2010 when reported in U.S. dollars, according to data compiled by STR Global.
In year-over-year measurements, the Asia/Pacific region’s occupancy rose 14.5% to 63.9%, average daily rate increased 10.8% to US$121.83, and revenue per available room jumped 27% to US$77.83.
• Read “STR Global: Asia/Pacific results for June 2010.”
Pan Pacific CEO discusses expansion
The three hotels announced for the Australian market announced by Singapore-based Pan Pacific Hotels Group represent a relaunch for the company, according to Patrick Imbardelli, president and CEO.
Two Parkroyal hotels in Sydney and a Pan Pacific hotel in Perth mark the return of brands that previously had been in Australia.
Parkroyal is a homegrown Australia brand, Imbardelli said during an interview at ANZPHIC. “We’re relaunching the brand, making it relevant for today in the Australian/New Zealand market, and we’re bringing Pan Pacific back,” he said.
The company committed more than AUD$200 million (US$177.9 million) to the assets, which bodes well for future Australian growth, Imbardelli said.
• Read “Pan Pacific CEO discusses expansion.”
This and that…
• Gross operating profit levels of the 5-star hotel sector in China have fallen to the lowest level recorded in the eight years Horwath HTL’s China Hotel Industry Study has been published. The GOP level of RMB91,752 per room (US$13,538) is 39% lower than the peak recorded in 2005 and is the fourth straight year the figure has declined. In Beijing and Shanghai, the two largest hotel markets in the country, GOP levels in 2009 were RMB86,194 and RMB119,645 (US$12,718 and US$17,654) respectively. The Beijing hotel market in particular suffered dramatically recording occupancy of only 47.5% and an average room rate of RMB836 (US$123.35), which resulted in RevPAR of only RMB397 (US$58.58).
• Accor and InterGlobe announced the establishment of an investment fund for a portfolio of India hotel assets in which an affiliate of Pacifica Partners will take a significant stake of up to 36% equity in the fund, subject to requisite regulatory approvals. Accor and InterGlobe will each hold 32% equity in the fund. Pacifica Partners is the asset manager for the joint venture hotel investment company established between an affiliate of GIC Real Estate Pte. Limited and Host Hotels and Resorts. The fund will initially hold the assets for seven hotels in India that are currently jointly owned by Accor and InterGlobe, representing 1,750 rooms with a value of approximately US$325 million on the completion of the hotels.
• IHG ANA Hotels Group Japan, the joint venture between InterContinental Hotels Group and All Nippon Airways, opened ANA Holiday Inn Sendai.
• Investment-holding firm Alliance Global Group told The Wall Street Journal it soon will start building a fourth hotel at its Newport City development, located near the Philippines's main international airport. Alliance Global President Kingson Sian said in a statement that construction of the 540-room Hamilton Hotel "clearly demonstrates both our strong commitment and our confidence in the potential of the tourism industry in the Philippines." The hotel is expected to be completed in 2012, he said.
• Shangri-La Hotels and Resorts will open three new hotels in north China in 2013. The projects are in Qinhuangdao, Tianjin and Tangshan, all of which are important coastal cities on the Bohai Bay with ports serving North China and Northeast Asia. The Shangri-La hotels will join the group’s portfolio of north China properties in Beijing and Inner Mongolia. With this year’s opening of China World Summit Wing, Beijing, Shangri-La will have eight properties in the region. Developments in the Hebei province, the Tianjin municipality, and an additional hotel in Manzhouli Inner Mongolia, will bring this number to 12 hotels in the region in the next three years.
• Starwood Hotels & Resorts Worldwide plans to operate at least three Four Points by Sheraton branded hotels in the Bangkok area by 2011.
• Carlton Hotel, Singapore added 287 rooms. The Premier Wing at the 915-room hotel features new rooms, an exclusive Premier Club lounge for members, Gravity Bar, new gym and spa, and extensive banqueting and conference facilities.