BUILDING , SUSTAINING Mainland China ’ s rebound continues gaining momentum , with international hotel groups , and home-grown brands , such as Mandarin Oriental , on rapid trajectories to open properties and capture anticipated market growth . As asset-light franchisors in China , Marriott International , Hilton , IHG and others don ’ t carry the financial risk of investing in |
their hotels , since most are built with hybrid ownership models between provincial government departments and Chinese private investment companies .
“ Some years ago , Chinese provincial governments had land in the middle of their cities but not necessarily the money to develop hotels , so they partnered with private Chinese investment firms and brought in operators — some Chinese , some
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international ,” said Bagaeen .
In many cases , Bagaeen said that private corporations fully own both the land and the hotel . “ There ' s always government involvement ,” he said , “ but the private sector drives much of it and hotels still make money . Many people in China , just regular people , have made a lot of money over the last several years due to real estate values growing by double digits and
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affecting their income and net worth . As long as hotels remain profitable , investors want to put their money there .”
This is good news for operators with flourishing portfolios . In the first half of 2024 , for example , Mandarin Oriental Hotel Group generated an overall 13 % yearover-year revenue increase in Asia , in which China is a key market , according to the brand ’ s
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Jan / Feb 2025 hotelsmag . com 43 |