Jones Land Lasalle Releases Hotel Ownership Pendulum
Jones Lang LaSalle Hotels released the Hotel Ownership Pendulum in Motion Research Paper, examining the current ownership profile of Asian and global hotel real estate, how this has changed over the last 10 years and the emerging ownership trends. Historically the Asian hotel and resort real estate was largely held by family controlled public and private companies with some institutional and opportunity fund ownership. Over the last five years, international groups, especially U.S. investment funds have emerged as new owners of hotels in Asia, particularly in Japan and to some extent in Thailand. JLLH said a key factor of changing the ownership profile in Asia is the improvement in the region's macroeconomic environment which has strengthened after a period of structural reforms and consolidation as well as improved trading performance following a strong revival in tourism trade. Improved market transparency, greater availability of information about hotel trading and better understanding of the sector's cyclical nature have collectively increased the appeal of hotel assets. Better transparency helps investors to better understand the markets, which in turn leads to heightened interests in the sector and consequently greater transparency, according to JLLH. The sheer weight of capital seeking real estate globally in the current low-cost debt environment has been the key driving force behind the record levels of hotel transactions in 2005. U.S. based investors have been scouring the world for alternative opportunities such as hotels, Middle Eastern investors are looking for opportunities to buy. A lot of the transactional activities are driven out of the Americans but Asia and Europe too are witnessing a strong momentum. Japan single-handedly accounted for more than 2/3rds of the number of hotel transactions in Asia in 2005. Domestic and US opportunity funds have surfaced as the new owners of Japanese hotel real estate which were previously dominated by Japanese private and public companies. JLLH expects increased transactions compared to historical experience as opportunistic players typically hold assets for shorter periods. JLLH said China offers significant upside potential with attractive GOP margins and expectations for RevPAR growth supported by a rapidly developing domestic economy. They expect regional players from Hong Kong and Singapore to be active in the market while new players including private equity and investment banks are entering the market in China. These investors are expected over time to replace traditional owners such as state-owned enterprises, public and private hotel owners and developers. JLLH said that while they see continued divestment in China and Japan, the scarcity of assets across the region should provide support for more aggressive pricing and this could lead to a tightening of yields. Destination Properties Co. Ltd. announced an agreement with ALiLA Hotels and Resorts to manage their 200 room lifestyle resort property in Phuket, Thailand. Formerly known as Kamala Bay Terrace Resort, it will be re-branded as ALiLA Phuket. Situated on the west coast of Phuket at the heart of the island's famed "Millionaire's Mile" this 4.25 rai development will comprise 200 sea-facing rooms and will be managed and maintained to international luxury standards by ALiLA Hotels & Resorts. ALiLA Phuket is expected to be completed by mid 2007. Jin Jiang International Hotel Management Company has completed the development of its new hotel brand identity and has commenced using their new logos. Jin Jiang Hotels developed the new identity over 12 months. The key element of the new logo is the double "J" mark which represents the first two letters of Jin Jiang and the roof line of a Chinese Imperial Palace. The target of the Jin Jiang Group is to set up a brand family comprising of five to seven multi-positioned sub-brands within three to five years. Jin Jiang's key brand strategies include: international expansion of Jin Jiang Hotels through acquisition and cooperation with international hotel groups; enhancement and renovation of key hotels; promoting the brand through the portfolio of heritage properties such as the Peace Hotel; develop branding elements that reflect the Chinese culture, Jin Jiang features and international standards, building on a highly regarded domestic reputation; promoting Jin Jiang's international reputation by association with the 2008 Beijing Olympics Games and the 2010 World Expo in Shanghai and in early 2007, they will launch a new Jin Jiang Hotels Loyalty Programme targeted to have several hundred thousand members within 5 years. Vietnam's Phu Quoc Island is aggressively seeking foreign and domestic development. The plan is for Phu Quoc to become a high quality tourism centre and a trade and services hub for Vietnam and the region. The People's Committee has approved 12 investment projects so far this year on an area of more than 60 ha and with a combined capital of VND670 billion. Most of the projects are concentrated in the tourism sector and include hotels, restaurants and a hot springs resort with the objective to develop the island as an international luxury tourist destination. Accor's Grand Mercure La Veranda Resort and Spa will open on Phu Quoc Island at the end of this month, developed with a total investment of US$4.2 million. Sunway City Bhd plans to set up Malaysia's biggest real estate investment trust in two years with a value of at least RM1.5 billion. Sunway will complete some property projects by September or October next year before starting the investment trust in 2008. The REIT will have assets such as hotels, malls, university campuses and houses located in Kuala Lumpur and Penang, according to Hwang-DBS Vickers Research. The REIT was planned for this year but was delayed to coincide with the completion of the company's projects. Marriott International appointed Richard Lyon as GM of the JW Marriott Mumbai. He was previously GM of the Renaissance Chancery Court Hotel in London. M Hotel in Singapore announced the promotion of Charles Lai to executive assistant manager. Sunny Sia Hai Chew was appointed executive chef of the hotel, andJamie Chua was named fire, safety & security manager. Fairmont Hotels & Resorts announced that Kent Cooper was named regional director, sales and marketing, Middle East & Africa. Cooper was previously director of sales and marketing for Fairmont's property, The Fairmont Dubai. Central Hotels & Resorts appointed Elaine Chua as new group Spa manager. Chua was previously business development consultant of Gorgeous Getaways, based in Malaysia.
