Irresistable: international hospitality brands fall for China’s numbers game
Ascott and ONYX hospitality brands seek first-mover advantage by securing lucrative contracts in China’s serviced apartments and hotels
Ascott and ONYX, the two international hospitality brands headquartered in Southeast Asia, have been increasing their presence in China’s domestic travel sector. Chinese travellers made 4 billion trips within the country in 2015, twice as many as in 2014. China also leads the global outbound travel market.
Ascott, wholly owned by the Singapore-based Capitaland, has inked deals to manage eight new serviced residences in Beijing, Chongqing, Haikou, Hangzhou, Shanghai and Xiamen through its Ascott, Citadines and Tujia Somerset brands. The properties will add 1,200 apartments to Ascott’s portfolio in mainland China.
Serviced apartment operators are looking expectantly to China for growth as supply of this type of accommodation, which mainly caters to expatriates, is expected to grow by 7.9 per cent in major cities over the next five years.
A report by international property consultancy JLL says it expects around 3,300 new serviced apartments to enter the market in that time.
In Beijing, the property agency forecasts 1,380 serviced apartments will be established over the next three years, reflecting an annual growth rate of 8.3 per cent. Beijing’s stock of international serviced apartments stood at 5,600 units by the end of 2015, according to official figures.
While China’s hotel boom has been well reported, with growth in revenue per available room, serviced apartments have developed rapidly over the past five years. Revenue per available room in five-star hotels averaged 11.4 per cent and 11.7 per cent growth in Shanghai and Beijing in that time.
Lee Chee Koon, Ascott’s CEO, says: “We have secured the highest number of units of all time, made our most expansive growth across 12 cities in China and extended our footprint to Haikou and Shaoxing.
“Besides forming strategic alliances and securing more management contracts, being the first serviced residence company to partner new economy leaders like Tujia and Fliggy (Alitrip) has also given us significant first-mover advantage to boost Ascott’s presence in the country as the fastest-growing international serviced residence company.
“As we scale new heights, we are closing in on our target of 20,000 apartment units in China and 80,000 units globally by 2020.”
Of the eight new serviced residences, Tujia Somerset Palm Springs Chongqing is operational and the other seven – Ascott Central Haikou, Citadines Taoyuanju Chongqing, Citadines Xixi Wetland Hangzhou and four Tujia Somerset properties – are scheduled to open from next year to 2020. Ascott opened 10 properties in China last year, adding more than 1,900 units to its network of serviced residences.
ONYX Hospitality Group, headquartered in Thailand, is set to open the company’s first Amari hotel, Amari Yangshuo, in China. The 73-room property is earmarked to open in the first half of 2017.
Amari Yangshuo is next to the popular West Street, one of the oldest streets in Guilin, Guangxi, with views of the waterfront, the iconic love bridge and karst peaks.
This four-storey hotel combines local oriental influences with Thai-style design and is developed by Shenzhen Yitian Group as part of the exciting Yitian West Street development. The hotel will be managed by ONYX Hospitality Group as an Amari property.
“At ONYX Hospitality Group, we are committed not just to attracting more guests to our Thailand-based properties, but expanding our presence in other parts of the region,” says Tommy Lai, vice-president, north Asia, ONYX Hospitality Group.
Lai says ONYX has also signed a deal to manage Shama Xiangnanli Chengdu, which is its second management agreement in Chengdu. The new Shama property within the Tianfu New Area, will comprise a total of 252 apartments, from studios to three-bedroom apartments. This is scheduled to open later this year.
“In Hong Kong, we have secured two new serviced apartments management agreements this year – Shama Mid-Levels Hong Kong, a 24-key serviced apartment on Kennedy Road, and Shama Island North Hong Kong, a 121-key property with a mixture of hotel rooms and serviced apartments,” Lai says.
The Mid-Levels property is already open for business, while the latter will welcome guests later this year. The group will also open a new 61-key hotel in Mong Kok next year. Hotel 108, is at 108 Soy Street.