In this week’s roundup of news from the Asia/Pacific region: Next Story Group’s expansion plans; STR performance data; Huazhu Hotel Group’s development pipeline; 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.
What’s next for Next? Expanding its 37-hotel roster
Singapore-based Next Story Group plans to grow its hotel portfolio through its Next Hotels and Sage Hotels brands as well as its Kafnu shared-workspace brand that will include hotel accommodations in some locations, writes HNN’s Jeff Higley.
Most of the expansion will take place in areas in the Asia Pacific region outside of Australia, as the company has a sizeable presence there already with its Country Comfort, Chifley Hotels and Sundowner hotel brands.
“Asia is obviously a very important market for us,” said Andreas Flaig, group chief development officer. “We do want to bring the brands into Asia—initially Southeast Asia, but we also see opportunities beyond that.”
STR: Asia/Pacific hotel performance for October 2018
Hotels in the Asia/Pacific region reported positive year-over-year growth during October 2018, according to data from STR, parent company of HNN. Occupancy grew 1.6% to 72.5%, which combined with 1.5% growth in average daily rate to $111.68 led to revenue-per-available-room growth of 3% to $80.93.
Hotels in Bali reported strong growth during the month, hitting record-high ADR and RevPAR levels for any October in STR’s Bali database. Occupancy grew by 18% to 75.6%, and ADR grew by 39% to 1,890,946.89 Indonesian rupiah ($130.42). As a result, RevPAR grew by 64.1% to 1,429,016.40 rupiah ($98.56).
Phuket, however, continued its trend in RevPAR decline. Occupancy fell by 16.1% to 63.5%, which could not be offset by a 0.7% increase in ADR to 2,985.51 Thai baht ($90.42). RevPAR dropped by 15.5% to 1,896.78 baht ($57.45).
Fujita Kanko to launch new brand aimed at millennials
Tokyo-based Fujita Kanko announced it is launching a new brand, Tavinos, which is aimed at “adventure-seeking millennials and like-minded travelers from around the world,” according to a news release.
"There are already affordable accommodations throughout Japan, but travelling millennials are hungry for the community of a hostel and the professionalism and expertise of an experienced hotelier," said Akira Segawa, president and CEO of Fujita Kanko, said in the release. "Tavinos will offer what outgoing and adventurous travelers want: the opportunity to meet interesting people, plan activities together, and explore."
Huazhu Hotels Group hits development milestones in Q3
Huazhu Hotels Group reported strong performance during the third quarter during the company’s latest earnings call, reports HNN’s Bryan Wroten, but company officials were most excited about its pipeline.
The company’s development pipeline increased steadily over the past year, CFO Teo Nee Chuan said, and it opened 235 hotels and closed only 83 during the third quarter. It is on track to achieve its full-year opening targets, he said, and the pipeline hit a historical high of 924 hotels by the end of the quarter.
“With the gradual maturity of a number of our younger and newly acquired brands, we continue to attract increasing interest from our franchisees to join our hotel network,” he said. “Therefore, we are not only confident in achieving our operating target for 2018, but also to further accelerate our opening target in the coming 2019.”
Wharf Hotels: A ‘regional player’ with a specific niche
Hong Kong’s Wharf Hotels is working its way through the opportunities and challenges presented by industry consolidation, writes HNN’s Jeff Higley. The 16-hotel company, formerly known as Marco Polo Hotels, sees its size and role as both owner and manager as an advantage for those looking to get involved with its brands.
“With all the mergers and acquisitions, there are a lot of owners who don’t want to be lost amongst the plethora of a larger group of names,” Wharf Hotels President Jennifer Cronin said. “They know, and we work very closely with them, that they deal directly with me or any of our vice presidents, and this is where we can give them the support that they expect and require.
“The greatest opportunity is for those mergers and acquisitions to keep growing … it gives us a unique selling opportunity,” Cronin said. “And for our people, whilst we may not have career opportunities globally, we have tend to move our people between our hotels on a regular basis.”
Jin Jiang finalizes acquisition of Radisson
The Jin Jiang International-led consortium announced it completed its acquisition of Radisson Holdings and 51.5% of the outstanding shares of Radisson Hospitality AB, according to a news release. The purchase price under the agreements was 35 Swedish krona ($3.85) per share.
Asia-based hotel investors remain bullish but watchful
Global hotel investors based in Asia explained why they remained so interested in the hotel industry’s prospects, writes HNN’s Jeff Higley from the Hotel Investment Conference Asia Pacific. Much of it has to do with the continued growth of outbound Chinese travelers looking to visit other parts of the world.
“They’re going to experience the key cities first like New York, London, all these other places—and that’s the reason we have ventured into the European market,” said Dillip Rajakarier, CEO of Bangkok-based Minor Hotels. “At the same time, you also have India, which is another big country. You have Brazil. You see them coming into Asia and Middle East and places like that. And I think the future will be Africa. So we get these waves of travel within the different geographic segments. But the thing is how quickly we need to adapt.”
Deals and developments
- Singapore-based CDL Hospitality Trust acquired a 95% interest in Hotel Cerretani Florence, MGallery by Sofitel for €40.6 million ($45.9 million).
- Singapore-based Fragrance Group intends to redevelop the Waterloo Apartments in the Bras Basah-Bugis area and the Tower 15 in Tanjong Pagar area into hotels.
- Singapore’s Banyan Tree Hotels & Resorts opened its first Angsana hotel in Cayo Santa Maria, Cuba: the 252-key Angsana Cayo Santa Maria.
- Switzerland-based Mӧvenpick Hotels & Resorts opened its first resort in the Maldives, the Mӧvenpick Resort Kuredhivaru.
- Singapore-based real estate group Hiap Hoe acquired the Aloft Perth Hotel and an office building for $100 million Australian dollars ($72.1 million).
- Singapore’s Naumi Hotels acquired the 115-key Comfort Hotel Wellington and the 62-key Quality Hotel Wellington in the central business district of Wellington, New Zealand.
Compiled by Bryan Wroten.