hotels

Rolling it out or rolling it up?

It is not what you would expect from upwardly-mobile and status-conscious China. But a vogue among Chinese hotels for dropping a star from their hard-won “five star” ratings appears to be catching on.

Xinhuanet, website of China’s official Xinhua news agency, quoted Chen Miaolin, vice president of the China Tourism Association, as saying that 56 five-star hotels pledged to downgrade to a four-star rating last year. In addition, a significant number of newly-built hotels delayed their filings for a five-star rating.

Modesty, it appears, is not the prime motivation for the trend. 

What’s in a star anyway? China’s economy hotel chains are booming, gaining ground at the expense of star-rated hotels.

They are pushing out 2- and 3-star hotels; but at the top of the market 5-star properties are still growing fast, creating a polarised market. Chart of the week takes a look at the numbers, which show a sector undergoing dramatic shifts. 

A dash of good news from Harare, Zimbabwe’s capital city: construction work on a Hilton hotel is due to begin in October. With a cloud of political uncertainty hanging over the country and in the midst of a messy “indigenisation” of foreign businesses, it’s a pretty bold move.

The Hilton will need some contingency plans, given the chronic water shortages and power cuts that plague the country. It may find it harder to deal with low occupancy rates across Zimbabwe. 

It is no secret that many multinational companies avoid Belarus because of the unfavourable reputation of the country’s authorities and western sanctions against them. But this, apparently, does not apply to the hotel business. Several big name hotel brands are springing up around the capital, Minsk. 

It was quite an occasion for leaders from over 50 African countries when they met a few days ago to celebrate the Organisation of African Union/African Union’s 50th anniversary.

But behind the golden anniversary pomp, the dark issue of the organisation’s funding casts a shadow on its plans to fulfil its dreams. The AU, criticised for being dependent on Western cash, seeks to raise more of its funds from members, not least by a controversial tourism tax. 

A multinational from Mali sounds like a contradiction in terms. But the Azalai Hotels chain is just that.

Businessman Mossadeck Bally got into hotels 20 years ago. He now presides over a chain of six landmark properties in four countries, with a sheaf of expansion plans. He’s not yet Africa’s Conrad Hilton. But he has built a thriving group recently valued at over €60m, employing 800 people in some of the world’s poorest states. 

Opening the only five-star hotel in Iraq two years ago was a bold move by any standards. Throw in marketing cigarette makers in Lebanon and distributing Shell Lubricants in Iraq, and Malia Group looks like a controversial risk-taker. 

Peru has cashed in from tourism in recent years thanks to a clever strategy of exploiting its biodiversity, exquisite food and Inca legacy.

Now hotels chains, with Hilton Worldwide and Marriott International in the lead, are to invest as much as $1.76bn over the next three years as tourism is skyrocketing in the Andean country. 

The Peninsula Hotel, Hong KongWith all the new purportedly top-quality hotels popping up in China, what’s the guarantee of service and taste? Very little, according to Clement Kwok, the chief executive of Hong Kong & Shanghai Hotels, which is placing an emphasis on quality over quantity.

Kwok criticised the star-rating system, as well as the rapid hotel expansion in China and other emerging markets by competitors during a media lunch at the company’s flagship Peninsula Hotel in Hong Kong

You would think that building hotels in Brazil should be a straightforward affair.

With the country set to host the World Cup in 2014 and the summer Olympics in 2016, Embratur, the government’s tourism arm, reckoned it would need to expand hotel capacity by at least 20 per cent to accommodate the expected influx of visitors.

So boom time for hoteliers right? Not exactly, according to Kirk Kinsell, who heads up the Americas division for InterContinental Hotels Group. 

The magazine may not be available yet, but Playboy plans to open in India. That’s right, the magazine famous for nudity – and underrated for it’s articles – is going to open retail outlets, clubs, hotels and fashion cafés, according to the Economic Times.

This is in a country whose film industry has only recently begun showing committed couples kissing. The same country where anything – from a couple’s celebrating Valentine’s Day to an impromptu kiss between a famous Buddhist and a Celebrity Big Brother contestant – can spark outrage and protest. 

In a sign of Mozambique’s emergence as a middle-market tourism destination, Britain’s benchmark over-50s package holiday organiser, Saga, is to run tours in the country next year.

It’s a positive development for an industry the government wants to develop as a major foreign exchange earner, but Mozambique has a way to go before it starts squeezing as much money from its visitors as its regional rivals. 

Aim for the Hollywood sign, and then head about 9 miles southeast.

India’s Sahara Group is in the initial stages of talks to buy a majority stake in the Beverly Hilton Hotel. While he would not confirm the exact details, the Economic Times reported on Wednesday that the company was in talks to pay around $340m for a 55 per cent stake from US-based Oasis West Realty.

The hotel – whose ballroom holds the Golden Globe Awards each year – won’t be Sahara’s first foray into iconic luxury hotels. Earlier this year it bought a controlling stake in New York’s famed Plaza Hotel for $570m; the company also bought London’s Grosvenor House Hotel for $726m in 2010. 

Richard Solomons, chief executive of InterContinental Hotel Group, the world’s largest hotel group by rooms, says he remains confident about China despite its slowing growth.

Accor on Monday gave its clearest signal yet that it sees its future in emerging markets by snapping up the South American hotel portfolio of Mexico’s Grupo Posadas for $275m.

The move comes less than two months after the French hotel group sold its underperforming Motel 6 chain of US budget hotels to Blackstone in a $1.9bn deal and will  see Accor join rivals such as Hilton, Starwood, InterContinental Hotels Group (IHG) and Marriott in the race for EM hotel assets.