but extravagance is off the table . “ Instead of multiple dining venues and giant ballrooms , it ’ s one dining venue and a more modest ballroom , for example ,” Ho says .

There is pent-up demand in the mid-tier and focused-service sectors . According to Lodging Econometrics , the economy sector dominates the Asia Pacific pipeline as domestic tourism continues to grow and international business travelers court businesses in new economic stimulus zones .

For some giant international flags , that means turning a boutique offer into one of the primary development drivers for the region . Wyndham Hotel Group just announced it is adding Tryp by Wyndham to the five brands that already have a presence in China .

According to Ho , any new offer will have to be tailor-made for this increasingly sophisticated market . “ The rise of the lifestyle sector in major markets means a lot more than just a personalized stay ,” he says . “ It ’ s opening up a new business model .”

The plus for lifestyle lies in the flexibility of the concept . For the first time , some insiders see the conversion market heating up . That could open up opportunities for regional players to get a solid foothold in this market , or for brands like Hotel Jen to strategically reflag sister-branded hotels . ( Hotel Jen Shenyang was formerly a Traders Hotel , and half of the brand ’ s total pipeline are conversions .)

Reflagging opportunities also make for exciting fodder for international brands looking to compete with local powerhouses like 7

Days Inn . “ A lot of deals that were done with local economy brands 10 to 15 years ago have come to term ,” says Bob Loewen , executive vice president and chief operating officer , Wyndham Hotel Group . “ Owners are looking to rebrand , and we plan to capitalize on that .”

Both local and international brands are eyeing the resort market . An increasingly affluent domestic travel market is drawing the heat into more diversified markets and products . Resort products catering to leisure FITs and families are becoming popular and range from luxury resorts , family resorts , camping sites and B & Bs to more interesting container and tented accommodations , according to Dai . “ We think there are great development opportunities for these types of resort products in suburban areas and the traditional or emerging tourism destinations with improved accessibility ,” she says .

Redrawing the map That same out-of-the-box thinking applies to finding the next hot spots . “ Development is moving inland , and we see more opportunities in tier-three and -four cities ,” Loewen says .

“ There are markets like Wuhan that are currently struggling but will be hot in a few years , so we ’ re looking at a conversion there ,” Ho says .

Kenneth Macpherson , chief executive , Greater China , IHG , is focused on Yunnan and Sichuan Province .

However , it is not just the “ what ” and the “ where ” of the Chinese market that are experiencing a

China has the second-largest country pipeline with

pROjEcTS , and remains number one by rooms with 570,805 and accounts for 65 % of Asia Pacific pipeline projects ( nine out of 10 of the top markets in Asia Pacific are in China ).

The top five China markets by projects are :

Shanghai

Guangzhou is forecast to oPen 69 hoTels accounting for 7,721 rooms in 2015 — the most by both rooms and projects in any market in the world based on current projections .

Source : Lodging Econometrics

rapid shift . It ’ s also the “ how .”

Increasingly operations-savvy owners are demanding a lot more from hotel operators . That ’ s not necessarily key money from major international chains ( though regional players like Rosewood Hotel Group say strategic investment is important ) but overdelivery on everything from design concepts to products and operating models , as Voellm points out .

They also want control . Some insiders point to franchising as the future of development , at least for major international chains . “ I actually could see the balance tipping toward franchising five years from now ,” says Andreas Flaig , executive vice president of development , Asia Pacific , Carlson Rezidor Hotel Group .

Whatever terms owners want , they ’ ll find many contenders interested in working with them . The list of operators seeking to get or grow their Chinese presence continues to expand . “ Regional players such as Rosewood Hotel Group are becoming more active and confident in making deals ,” Dai says . “ Plus , special attention should be paid to domestic players such as Wanda , BTG Hotels , HK CTS , New Century , Huazhu , Plateno , et cetera . These groups have strengthened their IT systems , loyalty programs and more .”

If there ’ s one takeaway everyone can agree on , it ’ s that opportunities in China are far from being fully exploited . “ The infrastructure investment continues , and that ’ s going to continue to have a positive effect on our industry ,” Flaig says .

www . hotelsmag . com May 2015 HOTELS 31