The Chinese middle class is already larger than the entire population of the
United States. In fifteen years, it is expected to rise to 800 million. Helen Wang, The Chinese Dream: The Rise of the World’s Largest Middle Class and What It Means to You
are being considered, and new brands are coming to the fore. InterContinental Hotels Group, which launched the Chinese- oriented Hualuxe Hotels & Resorts brand in March this year, has gone as far as to call China its “strongest market” having seen a 16% rise in profits in the first quarter of 2012, largely driven by an 11.9% increase in revenue per available room in the country. In addition, the group’s forecasted openings of 51,742 guestrooms / 155 hotels in Greater China over the next three-to-five years, constitutes 30% of its total global pipeline. Key performance indicators across the board are positive according to data compiled by STR Global. In year-on-year measurements, the Asia Pacific region’s occupancy increased 3.8% to 67.6%, its average daily rate increased 3.6% to US$145.01, and its revenue per available room was up 7.6% to $98.07. Beijing showed to be leading China’s performance reporting a 17.6% increase in ADR and a 20.4% increase in RevPAR to CNY561.91. Commenting on the data, Elizabeth
Randall, Managing Director of STR Global said: “Hotels across Asia Pacific sustained
their growth in occupancy and average room rate. Looking at the supply and demand results for the first four months of this year, supply grew at the lowest rate for the January to April period for the past six years (+2.8%) whilst demand achieved the second highest growth rate for the four-month period in the past six years with 5.3% improvement, only surpassed by the demand growth in the corresponding period in 2010.”
HVS also recorded positive results for
key markets across mainland China. The HVS Quarterly: Hong Kong, Macau, China and Taiwan Update, compiled by Associate Cathy Luo, and Managing Director, Daniel J Voellm, names Sanya as the top performing destination for Q1 2012, although this is largely due to seasonal effects. Occupancy in Shanghai increased by 3.6% as the city gradually recovers from a strong World Expo year in 2010, and while supply is still coming on line, it is expected to be absorbed in the long term. Beijing, the largest hotel market in the
country, “continues to improve, backed by a well-performing, developed economy”,
according to the report, with the city recording healthy average rate growth of 12.3% year-on-year. Elsewhere, Xiamen posted a record high
average rate of RMB770, and Changsha showed the strongest growth on all metrics. Chengdu, a city featuring in many a pipeline schedule, posted 10.2% average rate growth, supported by the addition of some 1,000 businesses and upscale hotel rooms. In the five-star hotel market, Sanya continues to excel, with average rate rising to a record RMB1,790. Much of the development, particularly in Sanya, is concentrated at the top end of the market, which seems logical given that there will soon be more millionaires in China than any other country. According to Lodging Econometrics, almost half of the construction pipeline is in the upper, upper upscale, and luxury segments. The majority of development from the
big players also lies in the mid-to-upper end of the market, leading some to believe that the biggest potential is in the budget sector. According to the HVS report, Asia Pacific: Significant Growth Opportunities
Sleeper China 2012 25
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