Upscale hotel market booming on Chinese mainland

Li Qian
A recent survey by the world's largest hospitality consulting brand Horwath HT reveals robust growth in the upper-midscale hotel market on Chinese mainland in 2020.
Li Qian

Rising demand for premium hospitality experiences is boosting China’s luxury hotel market.

A recent survey by the world’s largest hospitality consulting brand Horwath HT reveals robust growth in the upper-midscale hotel market on Chinese mainland in 2020. In particular, deals involving luxury hotels reported a year-on-year increase of 167 percent.

Figures by online travel operator show that high-end hotels accounted for nearly 40 percent of bookings during the Labor Day holiday.

The COVID-19 pandemic dealt a huge blow to the global hospitality industry last year. But in China, 2020 witnessed rapid growth in the luxury hotel market. Domestic demand is mushrooming, and the trend will continue, said Executive Director Zoe Wu of Horwath HT.

US hotel giant Hilton’s latest luxury signings in Shanghai have lent support to her prediction.

The hotel chain has recently signed strategic agreements with China’s Shimao Group to open four luxury hotels — a Waldorf Astoria hotel in Shenzhen and three Conrad hotels in Shanghai, Wuhan and Zhuhai.

Hilton remains bullish on China, and is increasing its stakes in the domestic luxury hotel market, hoping to tap into ballooning growth potential, according to Jerry Huang, president of development, Hilton China and Mongolia.

“With 1.4 billion people, China has such a huge population, and its middle class is growing,” he said.

When the hotels open, they will mark the debut of Hilton’s iconic luxury brands in the four cities, while Conrad Shanghai will take the spotlight as the largest Conrad hotel in Asia with more than 700 rooms.

Targeted to open in early 2022, the Conrad Shanghai will be located in People’s Square, considered one of the most bustling business and tourism destinations in the city.

Waldorf Astoria Shenzhen will be built in the newly developed central business district; Conrad Zhuhai will be built on the man-made islands alongside the Hong Kong-Zhuhai-Macau Bridge; and Conrad Wuhan will be built near the Wuhan International Expo Center, within a 30-minute drive of the city’s renowned tourist attractions such as Yellow Crane Tower and East Lake.

Shanghai has a mature high-end consumption market, and the Great Bay area is thriving. Wuhan is also set for growth due to strong government support and its advantageous location, according to Tyrone Tang, chairman and chief executive officer of Shanghai Shimao Hotel Management Company.

“The market goes with the country’s strategy," Tang said. "Shimao now focuses on developing in three areas — the Great Bay, Shanghai-Zhejiang-Jiangsu and Beijing-Tianjin-Hebei."

The luxury hotel market is booming in response to upgrades in consumption, according to Yang Yanping, secretary-general of the Shanghai Tourism Trade Association.

Today's mainstream customers are younger, Yang said. They want something different and unique, and they seek to have good living conditions and rich experiences while traveling.

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