Super 8 Hotels in China During 2004
|PARSIPPANY, N.J. (April 22, 2004) – Cendant
Corporation’s Hotel Group today announced it will franchise Super 8 motels
in China, consummating a strategy to compete there in three lodging tiers:
two- to three-star hotels under the Super 8 brand, three- to four-star
hotels under the Days Inn brand and four- to five-star hotels under the
Howard Johnson brand.
Tian Rui Hotel Corp, a privately held company based in Hong Kong, has committed to develop more than 55 Super 8 hotels during the next five years under a master license agreement. The company plans to open five Super 8 hotels this year, including its first, its flagship location, next month in Beijing. Tian Rui Hotel Corp believes its network of Super 8 hotels in China will generate nearly $150 million in gross revenue during the first five years.
Up to now, the Super 8 chain has been developed exclusively in the United States and Canada, where there are a total of 2,082 hotels representing 126,302 rooms.
In November 2003, the Hotel Group signed a master license agreement to franchise Days Inn hotels in China with Frontier Group Pte Ltd., a privately held company based in Singapore. The deal calls for the development of more than 40 Days hotels during the first five years, including five this year. Franchise rights to one existing Days Inn hotel in Changchun were transferred to Frontier Group.
Cendant’s Howard Johnson brand has been franchised in China since October 1998 by the Shanghai-based Berrate Development Group, which currently maintains a portfolio of two Howard Johnson hotels and has announced plans to open another four hotels by the end of the year and at least one five-star hotel in strategic provincial cities during the next three to four years.
Berrate’s plans for 2004 include opening Howard Johnson hotels in Beijing, Shanghai, Guiyang and Hangzhou. The Howard Johnson Paragon Hotel Beijing was the brand’s first hotel to open in China in 2001. The Howard Johnson Plaza Hotel Shanghai, the brand’s second hotel in China, opened in July 2003.
Steven A. Rudnitsky, chairman and chief executive officer of Cendant’s Hotel Group, said the lack of quality economy, midscale and first-class hotels presents a “substantial opportunity” for franchising the Super 8, Days Inn and Howard Johnson brands in China.
“Other major hotel companies have focused principally on developing luxury hotels,” he said. “Our business will be based on serving the growing middle class, especially domestic consumers who have discovered the benefit and flexibility of traveling the country on its growing network of highways,” he said.
In looking for a master franchisee, Cendant sought financial strength and a track record of business success, Rudnitsky said. “Tian Rui Hotel Corp is the right company at the right time to lead an aggressive Super 8 development campaign in China.”
Cendant Corporation’s Hotel Group, based in Parsippany, N.J., franchises 6,374 hotels representing 515,362 rooms on five continents under the Super 8®, Days Inn®, Ramada®, Travelodge®, Howard Johnson®, Knights Inn®, Villager, Wingate Inn® and AmeriHost Inn® brands.
Manager, Consumer Media Relations
Cendant Corporation, Hotel Group
|Also See:||Beijing Howard Johnson Paragon Hotel Is First Howard Johnson Hotel in China, Five More Scheduled to Open / May 2002|