Spring
2013
Asia Pacific
Lodging Real Estate Trends – Executive Summary

Asia Pacific pipeline at an all-time high, boosted by the continued development boom in china. global brands lead the way with explosive project growth in many markets.

At 4Q ’12 the Asia Pacific Construction Pipeline reached a record-high 2,401 projects/ 557,505 rooms. Just three countries, China, India and Indonesia, make up 91% of projects and 89% of rooms in the region.

China’s 1,622 projects/ 407,721 rooms account for 68% of the projects and 73% of the rooms in Asia Pacific. India, whose Pipeline peaked in 4Q ’10 and has been on the decline since, is at 350 projects/ 60,777 rooms. Indonesia is rapidly developing, having expanded its Pipeline each quarter from its bottom established in 3Q ’10. At year-end it has 181 projects/ 28,268 rooms in the Pipeline for a whopping year-over-year (YoY) increase of 118% by projects and 101% by rooms. All other countries combined account for the remaining 248 projects/ 60,739 rooms.

Asia Pacific has the highest concentration of high-end construction projects of any global region. Of all projects in the Asia Pacific Pipeline, 58%, or 1,204 projects, are in the upscale chain scale or higher. The remaining 42% or 874 projects are in the midscale chain scale or lower.

China’s Pipeline is the largest in the world

China’s Pipeline at 1,622 projects/ 407,721 rooms, has the highest room count in the world. Its project count is second only to the US. Despite a slowdown in economic growth in 2012, Pipeline metrics continue to set record highs. Until now, China’s government, when faced with a possible economic softening, has invariably chosen to increase bank lending and infrastructure development as a way to rekindle the economy. This economic policy has kept their Hotel Pipeline accelerating forward for nearly three decades.

Of the 25 Markets with the largest Pipelines, 21 of 25 are in China. Shanghai, with the largest population in the world, has the largest Pipeline in Asia with
86 projects/ 17,025 rooms. After two decades of frenetic activity, development may be topping out. Beijing, has the next highest total with 64 projects/ 10,581 rooms, a YoY jump of 60% by projects and 12% rooms. This higher percentage increase in projects compared to rooms is common in many Chinese cities.

It’s reflective of the growing number of smaller, midscale projects entering the Pipeline as global franchise companies are looking to expand brand distribution with projects that appeal to China’s growing middle class.

LEADING GLOBAL BRANDS IN THE CHINA PIPELINE
  • Starwood Hotels & Resorts has the most active Pipeline in China with 89 projects/ 28,981 rooms. Starwood’s focus remains on higher-end properties, with all 89 projects in the upscale and above chain scales, which includes their Sheraton, Westin and W Hotel brands.
  • Hilton Worldwide has the second largest Pipeline with 85 projects/ 29,220 rooms. The Hilton and Doubletree Hotel brands combine to make up a notable 90% of the rooms in Hilton’s Pipeline.
  • Accor’s Pipeline in China consists of 85 projects/ 21,553 rooms. Accor has a balanced portfolio of both high-end and mid-market brands. 27 of its projects are with the upper upscale Pullman Hotel brand and 25 projects are with the Ibis economy brands.
  • Marriott International has 66 projects/ 20,821 rooms in the Pipeline. 2/3 of their Pipeline is accounted for by 27 full service Marriott Hotels and by 16 mostly upscale, center city Courtyard projects.
  • InterContinental Hotels Group has 48 projects/ 17,069 rooms under development. The InterContinental and Crowne Plaza brands total nearly 3/4 of IHG’s Pipeline in China, emphasizing their ongoing commitment to develop larger, higher-end hotels in the major Chinese markets.
  • Hyatt Hotels, one of the early major developers of high-end hotels in China in the luxury and upper upscale chain scales, has 41 projects / 11,948 rooms in the Pipeline. 32 of those projects are with their Grand, Park and Hyatt Regency labels.

Order construction pipeline trend reports for these fast growing regions & countries they are invaluable for strategic planning & development decision-making

LE’s Construction Pipeline Trend Reports encapsulate all lodging development activity, providing hotel project and room counts for the Pipeline by stage (Under Construction, Starts in the Next 12 Months, Early Planning), as well as for LE’s proprietary Three-Year Forecast for New Hotel Openings. Two years of Prior Hotel Openings and current supply counts for Open and Operating Hotels (Census) are also included.

Views with the above metrics are provided by chain scale, property size, for all countries and their leading markets and for global and regional franchise companies and their brands.

To order annual subscriptions to LE’s Quarterly Construction Pipeline Trend Reports for Asia Pacific, or for any particular country in the region, or any other country worldwide, please call us at +1 603-431-8740, ext. 25, complete the attached inquiry form or email info@lodgingeconometrics.com for more information.