Global hotel chains from Hilton - the world's second largest hotel group - to billionaire Robert Kuok's Shangri-La are accelerating their expansion plans across the Asia-Pacific region, betting on the recovery post-pandemic recovery when countries in the region gradually reopened to international visitors.
Hilton is one of the most actively expanding hotel chains in Asia, planning to double the number of rooms here in the next few years. Hilton has opened 100 hotels in 2021 in this area with many brands such as Hilton, Waldorf Astoria, DoubleTree by Hilton… bringing the total number of rooms from 20,000 to 120,000 at 523 hotels. In which, 400 hotels are located in China, which is considered the most important growth market of this group.
In 2022, Hilton plans to open two hotels per week in the Asia-Pacific, which accounts for about 10% of the group's global portfolio. In the coming years, Hilton aims to open 760 more hotels here, bringing the total number of rooms to 270,000 units. Hilton has just opened the largest hotel in the region, the Hilton Singapore Orchard with more than 1,000 rooms, located in the famous shopping center of Singapore.
Christopher Nassetta, President and CEO of Hilton, said earlier this month during a visit to Singapore: “We found that every hotel segment in Asia Pacific is recovering rapidly.”
Meanwhile, Marriott is implementing a plan to expand its investment portfolio in Asia - Pacific, with the goal of opening nearly 100 properties in 2022.
Singapore-based Pan Pacific hotel group - controlled by billionaire banker and real estate mogul Wee Cho Yaw of UOL Group – owns and manages 39 hotels with nearly 12,500 rooms in Asia, Oceania, Europe and North America. Pan Pacific will add more than 4,000 rooms from 18 new hotels over the next few years to its existing portfolio.
Hospitality has been one of the industries hitted hardest by the Covid-19 pandemic over the past two years as governments around the world impose travel restrictions to combat the spread of the virus. However, Pan Pacific CEO Choe Peng Sum is confident that pent-up demand will spur a strong recovery that follows.
“Tourism will return,” Choe said when UOL announced its full-year 2021 results in February. “In the second half of 2022, we expect to welcome more international visitors. We will be well prepared to receive this number of guests.”
As countries in the region gradually ease restrictions, Asian hotel chains including Hong Kong-based Shangri-La and Bangkok-based Dusit Thani are preparing to bounce back from the pandemic.
Shangri-La has opened four new hotels in the past six months, including three across China with a total of 1,188 rooms. The group said it has multiple hotel and complex developments in the near future in Australia, China, Cambodia and Japan.
“The road to recovery has not been easy, as sporadic Covid-19 outbreaks caused continued disruption to international travel and impacted hotel operations in many of Shangri-La's key markets. ", Shangri-La CEO Lim Beng Chee said last month when it reported revenue had improved 20% to $1.24 billion in 2021.
“We are witnessing a recovery in travel around the world but with cautious optimism. While we remain vigilant against unpredictable fluctuations, we are poised for a post-pandemic future and prepared to seize business growth opportunities as they arise.”
Sharing the same belief in the recovery of the tourism and hotel markets in the region, Dusit Thani is developing more than 8,800 rooms in 52 new hotels in Asia Pacific.
Suphajee Suthumpun, CEO of Dusit International, said: “While we are confident that pent-up demand will stimulate growth and people will want to travel again, but recession threats and other external factors could affect the speed of the hotel industry's recovery. So we must continue to innovate across all of our businesses.”
Particularly in Vietnam, Meliá has signed a cooperation agreement with Vinpearl to manage 21 hotels and resorts under the Meliá Vinpearl brand. Meanwhile, IHG, Accor and Marriott respectively plan to open Regent Phu Quoc with 302 rooms in 2022, Fairmont Hanoi with 241 rooms in 2024 located in a complex project near Hanoi's Old Quarter, and Marriott Quy Nhon Resort & Spa with 250 rooms belonging to Hai Giang Merry Land complex.
Global investors are also increasing their investment in hotel real estate in the Asia-Pacific region thanks to confidence in recovery expectations. Investments grew 46 percent to $12.1 billion in 2021, according to CBRE. CBRE also forecasts resorts to attract significant investments in the second half of 2022, driven by growing expectations of a full recovery in both occupancy and occupancy.
A representative of CBRE said that the hotel is one of the sectors that will definitely benefit when the region's borders reopen. The sector offers attractive risk-adjusted returns and asset repositioning opportunities for investors seeking enhanced returns.
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