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 Ranking - Top Ten Worldwide
Hotel Chains Growth 1995-2005
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Paris, 26 October 2005

1995-2005: Results on ten years of growth for the hotel chains worldwide

  • The first positions in the ranking did not experience any great upset in the last ten years: of the top ten groups in the ranking of 1995, eight are still among the Top 10 in 2005.  Concerning the chains, the six leading brands have remained the same for ten years. 
  • The supply and demand of the groups however, has varied over the years: the growth rate of the ten group leaders between 1995 and 2000 has been on average 85%!
  • Mergers-acquisitions have been the preferred means for achieving growth for the big international groups. Many merging transactions were carried out during these ten years. 
  • The North American market has recorded the strongest growth, particularly in the budget hotels sector and the management in franchise. 
Hotel groups: Mandatory growth!
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Evolution of Leading Groups Between 1995 and 2005
Rank Group Rooms 2005 Hotels 2005 Rooms 1995 Hotels 1995 Evolution Rooms
1 InterContinental 532,701 3,532 356,800 1,925 +49%
2 Cendant 520,860 6,396 413,891 4,208 +26%
3 Marriott 469,218 2,564 184,995 874 +154%
4 Accor 463,427 3,973 256,607 2,265 +81%
5 Choice 403,806 4,987 293,706 3,358 +37%
6 Hilton Corp 354,312 2,226 92,452 226 +283%
7 Best Western 308,131 4,097 280,144* 3,409 +10%
8 Starwood 230,667 733 132,477 425 +74%
9 Carlson 147,093 890 79,482 349 +85%
10 Global Hyatt 111,651 355 77,512 167 +44%
11 Hilton International 99,257 395 55,005 162 +80%
* Source : Hotels
Source : MKG Consulting Database – October 2005
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The first positions in the ranking did not experience any great upset in the last ten years: of the top ten groups in the ranking of 1995, eight are still among the Top 10 in 2005. Nonetheless, growth is strong: in ten years, the supply, expressed in number of rooms at these groups, saw average growth by nearly 85%, nearly doubling their supply worldwide! Strong growth in supply is mandatory for holding a position among the sector’s world leaders.

Mergers-acquisitions have been the preferred means for achieving growth for the big international groups. Among the major deals may be observed the 1998 buyout of Promus, which ranked seventh at the time, by Hilton Corporation, and the disappearance of the British group Forte / Granada – fourteenth in 2001 – whose brands were separated and acquired by several groups. We may also observe the absorption of the groups Westin, Renaissance and Doubletree by Starwood, Marriott and Hilton Corp respectively.

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Groups – The five strongest increases in
capacity between 1995 and 2005
 

Group

Evolution rooms
Rooms
2005
Marriott International
+284,223
469,218
Hilton Corp.
+261,860
354,312
Accor
+206,820
463,427
InterContinental
+175,901
532,701
Choice
+110,100
403,806
Source : MKG Consulting Database – October 2005
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The group that grew its supply the most in the last ten years is Marriott International. Between 1995 and 2005, the American group grew its supply by 285,000 rooms – meaning a multiplication in its number of rooms by 2.5. This is thanks to steady organic growth of its brands, the buyout of brands such as Ritz-Carlton or Renaissance and the creation of new brands (Spring Hill Suites, TownePlace Suites).

The Hilton Corporation grew by more than 260,000 rooms, mostly thanks to the acquisitions of the groups Promus and Doubletree. The American group thereby multiplied its global supply by 3.8 during this decade. 

Accor, although it is relatively stable in the ranking, grew by more than 200,000 rooms. The French group relied heavily on the organic growth of its economy brands. It also finalised its implantation on the American market by acquiring the brand Red Roof, a few years after it bought out Motel 6.

The most dynamic sector: American economy hotels

In ten years, the ranking of hotel chains has not evolved much. Of the top twenty in 1995, fifteen reappear in the Top 20 at the beginning of 2005. The order varies from year to year, but the six chains in the lead have remained the same for ten years: Best Western, Holiday Inn, Comfort Inns & Suites, Marriott Hotels & Resorts, Days Inn, Sheraton Hotels & Resorts (in the order of the most recent ranking).
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Chains – The ten biggest increases in
capacity between 1995 and 2005
 

Chain

Evolution Rooms
Rooms 2005
Rank 2005
Express by Holiday Inn
+104,735
126,035
8
Hampton Inns
+80,362
130,398
7
Marriott
+73,091
178,331
4
Courtyard
+60,498
94,003
13
Comfort Hotels
+59,298
182,038
3
Mercure
+58,676
85,352
17
Super 8
+51,500
125,844
9
Hyatt
+48,432
93,651
14
Ibis
+36,542
75,602
18
Sheraton
+33,910
134,866
6
Source : MKG Consulting Database – October 2005
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Created in 1991, Express by Holiday Inn (also known as Holiday Inn Express) has the wind in its sails. The chain has grown by over 100,000 rooms in ten years and climbed 29 rungs in the ranking to find itself among the Top 10. Alone it represents 60% of the growth of InterContinental Hotels Group in the last ten years.

Hampton Inns, second in the ranking of strongest growth in room supply, has not stopped growing since 1995. From 1995 to 2000, under the aegis of the group Promus, the chain already posted annual growth by at least 10%. The trend continued within the Hilton Corporation, which brought it up to seventh place in the ranking of chains.

The chains Marriott, Courtyard and Fairfield Inn perfectly reflect their group, Marriott International. Their organic growth was spectacular and explains a good share of the group’s dynamism. The group Accor confirms its strong development by placing three European chains belonging to different categories– Ibis, Mercure and Sofitel – among those with the best progress. 

The ten chains that experienced the strongest growth in capacity all belong to a hotel within the top ten groups worldwide. For the most part they developed organically. Half of these chains are leaders on the economy segment and have a preference for franchise management. Except for Mercure and Ibis, they are located mostly in North America. Moreover, the upmarket segment is not well represented among those with the best growth.

MKG Database- Largest database in the world, outside the USA, with a good representation of all the hotel segments. MKG Consulting database contains a sample of more than 40,000 hotels representing more than 2,2 million rooms. The MKG Consulting database monitors the activity of 9000 hotels, representing 1.1 million rooms. 

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Contact:

MKG Consulting
 Georges Panayotis
+ 33 (0)1 56 56 87 90
georges.panayotis@mkg-group.com

Also See: The 2004 Ranking of Hotel Groups; Including the Ten Hotel Groups with the Greatest Increase in Number of Rooms / MKG Consulting / June 2004
The 10 largest Hotel Groups and the 10 Largest Hotel Brands in the European Union; The MKG 2005 Ranking Shows the Incontestable Predominance of Accor / February 2005

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