Skift Take
Will Accor-Banyan Tree be the model for Asian hotel groups to grow globally without losing their independence and brand value? The devil may be in the execution. Hoteliers are watching how this works out and many believe it could be tough-going.
Editor's Note: Skift launched a new series, Gateway, as we broaden our news coverage geographically with first-hand, original stories from correspondents embedded in cities around the world.
We are featuring regular reports several times per week from Beijing, Singapore, and Cape Town, and look for us to add other cities soon. Gateway Singapore, for example, signifies that the reporter is writing from that city although her coverage of the business of travel will meander to other locales in the region. Read about the series here, and check out all the stories in the series here.
Does Banyan Tree's deal with AccorHotels equate to losing your religion, or gaining new followers? Is it a loss of innocence? It depends on whom you ask.
Some see Banyan Tree Holdings’ decision to sell a small stake to AccorHotels as a desperate move by a boutique brand to expand in today’s competitive environment. Others believe the partnership can be transformative if the execution can follow through.
In an interview, Banyan Tree executive chairman Ho Kwon Ping gave us his perspective on the deal [see below].
Whatever the outcome, one thing is certain: Other Asian hotel groups pondering what route to take are watching the deal as they get squeezed by a consolidated industry, online travel agencies, and alternative accommodations.
Unlike the hotel sector in the U.S. or Europe, which have lots of institutional investors, most hotel owners in the region are individuals or family businesses, many passing the baton to the next generation. Banyan Tree is a classic example.
In 23 years, Banyan Tree has built itself up as a niche resort brand with 45 hotels in operation. With another 25 hotels under development, it is not as small as it used to be, or as big as it should be to justify a whole structure that can support global expansion. Last year, it was forced to examine legacy costs
