Property giant links up with timeshare leader
China National Real Estate Development Group Corp (CRED), the mainland's biggest real estate developer, has joined forces with Resorts Condominium International (RCI) to link their timeshare accommodation networks and expand their operations and reach.
China National Real Estate's overseas development president Wang Yonghe said an 'agreement in principle' was reached in which they would adopt RCI's management and technological standards, while both sides would gain access to each other's holiday exchange networks that would cover most major Asian, European and US cities. 'This way, we won't need to start from the scratch,' he said.
Actual co-operation and exchange would begin once CRED's bid to convert Hong Kong's 20,000 vacant Home Ownership Scheme flats received the go-ahead from the government. The territory, seen as a lucrative income earner, is considered an integral part of the mainland developer's China network that has now drawn RCI's interest.
The tie-up of the two heavyweights would see both companies as equal partners, Mr Wang said. RCI, owned by United States-listed Cendant Corp, offers opportunities to exchange holidays in about 3,700 resorts in nearly 100 countries.
CRED, a State Council-controlled developer, said a mainland timesharing scheme alliance, which is chaired by company chairman Meng Xiaosu, had recruited more than 100 mainland corporate members in 70 cities.
The scheme, popular in the US and some European countries, allows travellers to acquire accommodation rights on a weekly or monthly basis.
CRED's Hong Kong project, which drew fury from hoteliers, aims to capitalise on demand for budget accommodation from mainland tourists who had been arriving in droves after Beijing lifted visa restrictions in the summer.
But not all are convinced of the potential of a timeshare scheme in Hong Kong.
'Timeshare requires an owner to buy rights to use a particular holiday property for one or x-number of weeks for 25 to 30 years and they also have to pay the maintenance fee for the same period of time,' KPMG's Andrew Weir said.
'Why would somebody be interested to buy an x-week a year when [Hong Kong] hotel room rates are still pretty low and there's no shortage in supply. If people come here regularly, they would surely go to serviced apartments.'
Mr Weir said timeshares would be more successful in places where there was significant demand, such as in resort areas.
The Federation of Hong Kong Hotel Owners had also expressed misgivings about the timeshare scheme.
