THE PIPELINE : ASIA PACIFIC
Starwood ’ s Luxury Collection operates the Keraton at the Plaza in Jakarta . a broad approach to expanding in Asia Pacific , becoming the largest operator in Australia , New Zealand , Indonesia , Thailand , South Korea and Vietnam . “ Whilst China was always going to be the biggest market , we felt there was potential across the region ,” says Michael Issenberg , chairman and chief operating officer of Accor Asia-Pacific .
In the economy segment , Asian travelers have shown a decided preference to internationally branded chains . A recent study by Accor found 59 % of Asians would rather stay with an international chain ; moreover , they are willing to spend an average premium of 38 % to do so . Issenberg theorizes Asian consumers are eager for branded hotels because unbranded product has long been too unpredictable , and that is of particular concern for the new breed of intraregional travelers who may not recognize domestic chains in a foreign market . For that reason , the economy segment represents a quarter of Accor ’ s pipeline in the region — a higher ratio than in the past — including 50 properties signed in the first three quarters of 2012 .
The region ’ s ongoing demographic and infrastructural changes are similar to post-World War II America ,
Accor ’ s MGallery Muse in Bangkok
Barnett says . Along with the rise of the middle class , the region ’ s nascent network of cheap airlift mirrors the creation of America ’ s interstate system . Those shifting fundamentals make secondary markets sustainable for hotels , and they enhance leisure and business interest in regional urban destinations , Barnett says .
Debt access steady Access to debt in Asia has improved incrementally since the global financial crisis and in general terms has actually loosened up faster than in most regions , Issenberg says . There has been some tightening in selected markets , such as Vietnam , in recent months , he says .
China ’ s churning economic engine helps in terms of finance , as well . Regional developers no longer rely exclusively on banks and investors in America and Europe to move projects along . Look for private equity from Europe to explore Asia Pacific in greater numbers in the near term , if only because few other regional markets are in growth mode .
A consistent obstacle for hotel companies in Asia Pacific , particularly in the emerging markets , is staffing . The supply-demand balance is out of equilibrium in less mature markets . “ You train and train and train , and then you also do very aggressive career planning ,” Issenberg says . “ In terms of our retention tools , the most important one is developing people ’ s careers so that they stay with the company .”
32 HOTELS December 2012 www . hotelsmag . com