U.S. Hotel Groups Have Bet Big on China. Now They Have New Risks.
Photo Caption: Rissai Valley, a Ritz-Carlton Reserve. Source: Marriott International.
Skift Take
Betting against China's torrid economic growth has been a fool's errand for decades. But nothing lasts forever. Foreign hotel executives shouldn't make blind assumptions about endless hotel development opportunities in the country.
U.S. hotel companies saw China's economic rise as an engine to drive hotel development. But China's economic turmoil may upset their plans.
U.S. hotel companies continue to have high hopes for China.
Hilton said last week it plans to open 730 hotels in China over the next decade. Hyatt said this month that about 40% of its global hotel development pipeline is in China. Marriott has 369 projects with 95,665 rooms in China, according to a Lodging Econometrics count this week.Skift Research Senior Analyst Pranavi Agarwal weighs in:
"The chart on the left above shows that the major U.S.-focused hotel groups are expanding much quicker in Asia Pacific than in the U.S.. Their pipelines as a percentage of total supply in the U.S. is around 10-20%, while across Asia Pacific this metric climbs to 50-100%. The chart on the right shows that though the major brands only have a 2-5% share of existing supply, their share of the future pipeline is considerably higher, at 10-20%.”
The New RisksYet China's current economic woes throw a wrench into these growth plans. Some key po
