Even short-term headwinds in China's hotel recovery from the pandemic isn't deterring global hotel companies from flooding the market with new developments.
Earnings season wrapped last week for the world’s largest hotel companies, and 2020 results are what you’d expect: terrible.
Accor lost $2.4 billion last year, largely from its significant portfolio exposure to Europe and ensuing travel restrictions. IHG Hotels & Resorts lost a relatively minor — all things considered during a global pandemic — $153 million due to less exposure to luxury hotels in urban markets.
All the major global hotel companies united over the last two weeks of investor calls on the belief China will play a major role in getting the industry back to pre-pandemic performance levels.
Build, Baby, Build: China’s overall hotel construction pipeline — at nearly 640,000 rooms across 3,375 projects — was down 4 percent at the end of last year, Lodging Econometrics announced in a report Monday. But there are signs a construction recovery is quickly advancing.
The nearly 414,000 rooms actually under construction at the moment in China is up 2 percent from the third quarter. Roughly 117,000 rooms are expected to break ground in the next 12 months.
Hilton, IHG, and Marriott take the top three spots, respectively, for companies with the largest development pipelines in China. The government-owned JinJiang International Holdings, which owns Radisson Hotel Group, and Accor round out the top five.
Hilton announced a partnership with Chinese property developer Country Garden last year to build more than 1,000 Home 2 Suites properties across the country.
Construction Context: China’s