- The Washington Times - Friday, November 12, 2004

SHANGHAI — Premium hotels are opening all over Shanghai, Beijing and other Chinese cities as Regent, Ritz-Carlton, Hyatt, Sheraton and other companies pour billions of dollars into expansion.

Others are opening motels to serve a market that didn’t exist five years ago — Chinese travelers with their own cars.

With growth slowing in Europe and North America, hotel chains are targeting Asia and China in particular for new growth. They point to occupancy rates as high as 90 percent in Shanghai as proof there is plenty of room to expand.

“Many cities have become overbuilt. Shanghai will be the only city in Asia where there is a high level of established business and a level that will continue to grow,” said Martyn Standen, general manager of the Regent, a luxury hotel that is half finished. “The outlook over the next several years is remarkable.”

Between 1998 and 2002, the number of tourists visiting China jumped by 54 percent to 97.9 million. Growth stalled in 2003 with the outbreak of severe acute respiratory syndrome but has rebounded.

The number of Chinese travelers hit 878 million in 2002 and looks like it will top that figure this year.

“There’s going to be a need to take care of these people in the different market segments where they want to be served,” said Mark DeCocinis, general manager of the Portman Ritz Carlton Shanghai.

Three 50-plus-story premium hotels have recently opened in Shanghai — the J.W. Marriott, Four Seasons and Westin. Mr. Standen’s hotel, the Regent, is expected to open next June, and another 25 are under construction or still in the design stage.

All qualify for a five-star rating, the highest given out by China’s government, meaning they meet international standards for room sizes and offer swimming pools, business centers and other amenities.

In Beijing, Ritz-Carlton plans a 320-room luxury hotel for the new business district and another for the financial district on the Chinese capital’s west side.

Six Marriott hotels are planned. Hyatt International is taking a one-third stake in a boutique Park Hyatt in the Beijing business district. Starwood Hotels & Resorts Worldwide Inc. plans to open a Westin hotel on the capital’s finance street, four Sheratons in mid-sized cities, and a designer W hotel across from Shanghai’s famous Bund district within the next five years.

Meanwhile, Carlson Hotels Asia Pacific, which owns the Regent and Radisson brands among others, is opening a 300-room Regent in Beijing this year.

The hotels will come in quite handy when Beijing hosts the summer Olympics in 2008, but the country’s economic growth is the real driver behind the construction.

In major Chinese cities, a stay at a foreign-managed luxury hotel nowadays is comparable to that in a Western city. Free broadband Internet and executive lounges are standard.

It’s a far cry from the spartan “guest houses” of earlier eras, when even clean hot water for showers was a luxury not to be taken for granted. Back then, dinner menus offered a handful of choices — Chinese only — and independent travelers often fought long and hard to persuade clerks to open rooms held in reserve for Communist Party cadres.

Although Chinese-run hotels have progressed far beyond those days, they are still struggling to catch up.

“We need to deal very quickly with building our brand name,” said Yang Weimin, vice chairman of Shanghai Jinjiang International Hotel Development Ltd. The company is China’s biggest domestic hotel chain, with 139 outlets that include Shanghai’s famed Peace Hotel.

Jinjiang owns colonial era landmarks like the Jinjiang Tower, Park Hotel and Jing’an Guesthouse — elegant but well-worn and due for refurbishment. The company has teamed with France’s Accor Group to develop a modern marketing and reservations system. And it took the unprecedented step, for a state company, of hiring a foreigner — Christopher Bachran, a former Sheraton and Radisson executive — as president of its hotels group.

“If you say ‘Marriott’ or ‘Hilton,’ people know what to expect. We have to take our local brand to that international level,” Mr. Yang said.

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