In this week’s roundup of news from the Asia/Pacific region: Oyo Rooms’ growth plans; Radisson targeting Chinese travelers; strength in Vietnam’s hotel industry; 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.
Oyo CEO shares plan for making the ‘most-loved’ brand
Backed by large investors, Ritesh Agarwal, the CEO and founder of Oyo Hotels & Homes, is on a mission to make his company “the most-loved hospitality brand in the world,” reports HNN contributor Chitra Balasubramaniam. Founded in 2013, the company started with one fully managed building in Gurgaon, India, and now it franchises more than 18,000 buildings across 10 countries.
“Globally, the world’s accommodation market stands at 160 million rooms and is a $3.6 trillion opportunity and growing,” he said. “With us capturing less than one percent of the larger pie, we are just scratching the surface. We foresee an enormous opportunity for us to build a truly world-class brand.
“We are aggressively moving ahead to not only become the largest hospitality brand but also become the most-loved hospitality brand in the world. We are investing heavily on strengthening our capabilities in technology, talent and network, while creating an ecosystem of efficiency through which we are able to deliver higher yields for our asset owners. We have invested (heavily) in CapEx, appointed hundreds of GMs to oversee operations and customer experience, created job opportunities for over 100,000 people in India alone and set up 26 Oyo Skill Institutes for hospitality enthusiasts.”
Radisson execs see Chinese inroads with owner Jin Jiang
Radisson Hotel Group is taking advantage of its new ownership company, China’s Jin Jiang International Holdings, to grow the footprint of each of its seven brands in China and attract outbound Chinese travelers to its hotels in the Americas, reports HNN’s Robert McCune.
“We’re going straight to the source; we’re going to the Chinese market … really drilling into what Chinese customers want, at the different segment levels; what are they looking for and what are their expectations,” Radisson CEO and COO John Kidd said. “And in that regard, we have tremendous support and help from our owner, Jin Jiang. They are experts in this field.
“We have a plethora of information available to us … so that it becomes a whole complete approach instead of little bits and pieces. There is a strategy behind it.”
Wynn ends M&A talks with Crown Resorts
Shortly after news broke on 9 April that Wynn Resorts had proposed to buy Australia’s Crown Resorts for a total of $7.1 billion, Wynn officials announced the company ended its talks with Crown, according to Reuters.
In Crown’s news release, the company confirmed it was “in confidential discussions with Wynn regarding potential change of control transaction following approaches to Crown from Wynn.” The proposed acquisition would have been 50% cash and 50% Wynn shares.
The Reuters article notes that Wynn ended talks with Crown “following the premature disclosure of preliminary discussions.”
Marriott’s 2020 vision for Asia/Pacific expansion
Marriott International announced plans to have 1,000 hotels open in the Asia/Pacific region by 2020, according to a news release. The expansion plan would create up to 50,000 jobs in the region.
Marriott will add almost 100 hotels, representing nearly 20,000 guestrooms, this year in the region, the release states. The company’s Asia/Pacific portfolio currently comprises 710 hotels in 23 countries and territories.
"As important as our size is our commitment to deliver seamless and quality experiences for our guests at on-brand properties,” Craig Smith, president and managing director of Marriott International Asia Pacific, said in the news release. “Today's traveler demands authentic, personalized and transformative experiences, whether for work or for pleasure, as a way of broadening their individual horizons and achieving a deeper understanding of the world. As the world's leading hospitality company, it is in our DNA to strive to be part of our guests' favorite moments and memories. We are dedicated to Marriott International remaining Asia Pacific's favorite travel company."
Vietnam hotel industry still more bull than bear
The Vietnamese hotel industry has a number of factors working in its favor: increased intra-Asia travel, increased domestic travel and low supply growth. STR’s Jesper Palmqvist and Jan Freitag write that while Vietnam faces the same challenges of productivity, airlift, cost of living, minimum wage and labor shortages as other emerging Asian markets, the country has managed to address enough of the critical issues to sustain growth and improve its reputation as a tourist destination.
“As the growth of international arrivals from outside Asia stayed below 10%, intra-Asian travel into Vietnam grew well over 20% in 2018 with continued share shift from source markets China and South Korea,” Palmqvist and Freitag write.
“Vietnam remains a comparatively affordable destination in many regards, as the rapid tourism growth puts pressure on needed infrastructure development to be able to capitalize fully also on the potential revenue from tourists. The government continues to allocate funds for development both in poorer areas and cities like Hanoi to enable the lofty tourism goals set for 2020 and 2030.”
Deals and developments
- S.L. Development, a subsidiary of Singapore’s United Industrial Corporation, acquired the 575-room Marina Mandarin Singapore and parts of the Marina Square complex for 675.3 million Singapore dollars ($500 million).
- A consortium led by Singapore’s Heeton Holdings acquired the Crowne Plaza London Kensington for SG$148.9 million ($109.6 million).
- HPL Properties (West Asia), a subsidiary of Singapore-based Hotel Properties Limited, acquired the 198-room Weligama Bay Marriott Resort and Spa for $22.6 million.
- Japan Hotel REIT Investment Corporation acquired the Hilton Tokyo Odaiba for 62.4 billion Japanese yen ($557.4 million).
- Hilton signed a management agreement with Singapore-based M&L Hospitality to operate the new 244-room Hilton Melbourne Little Queen Street, Hilton’s first hotel in Melbourne.
- Marina Bay Sands and Resorts World Sentosa, two integrated resorts in Singapore, will each receive a SG$4.5 billion ($331.3 million) expansion that will add, among other developments, at least 1,000 guestrooms for each resort, in exchange for an extension of exclusivity period for their casino licenses until 2030.
Compiled by Bryan Wroten.