China Tourist

Checking in, again

Hyatt launches joint venture hotel chain in China

Mark-Hoplamazian-w

Hoplamazian: bullish on China

Since 2012 China has been the world’s largest source of outbound travellers. It also became the world’s largest market for business travel four years later.

Add those two milestones to another achievement – that the Chinese authorities have largely managed to contain the spread of Covid-19 since the peak of the outbreak which centred on Wuhan earlier in the year – and you can see why the country is one of the few bright spots in the travel sector, albeit most of it in domestic tourism.

Since April, when the last lockdown restrictions were lifted on residents in Hubei province, most Chinese have been able to travel freely, providing that they have a green health code on their smartphones.

Travel abroad is almost impossible, however, meaning that the 150 million Chinese who usually take annual overseas trips are looking for other options at home.

Domestic tourism still isn’t back to pre-pandemic levels, but business is rebounding – and some hotel operators are so positive about the market potential that they have launched new brands, even as the pandemic continues to curtail their operations in most other markets.

One such initiative is UrCove – a new chain of business hotels jointly owned by Hyatt Hotels Corporation and BTG Homeinns Hotel Group.

Other international hoteliers, such as the Ritz-Carlton and Marriot have opened new properties in Nanjing, Wuhan and Chengdu, among others cities.

Speaking to Sina.com, Jin Hui, president of the China Lodging Group, predicted that hotel revenues would get back to about 70% of 2019’s level in the second half of this year.

With each new week Chinese tourists are getting more confident about travelling again. Tourism agencies have also launched campaigns to attract domestic travellers to their provinces ahead of children returning to school this week. Business travel has been slightly slower to rebound, according to Jin, but that might change now that the summer holidays are over and commercial life returns to greater normality in general.

China overtook the US as the largest market for business travel four years ago, buoyed by its growing economy, more affordable domestic flights and a state-of-the-art high-speed rail network. This new class of travellers – dubbed ‘Road Warriors’ in the industry press – includes the executives who make trips to 690 cities around the country to attend meetings or complete site checks.

They need quick, clean and easy places to stay, but many also appreciate a bit of luxury too. This, according to Hyatt, is where UrCove comes in – positioning itself between efficient but bare-bones budget hotels like Hanting and 7 Days Inn and the 3,000 four-and five-star hotels already doing business in China.

“These highly mobile travellers [Road Warriors] often seek out efficiency and comfort but are limited in opportunities to get the best out of their travel experience,” Hyatt’s press release on the launch claims.

The brand’s Chinese name – Yi Fei – means ‘comfortable residence’.

Unsurprisingly, UrCove’s first two outlets will open in Beijing and Shanghai later this year.

Last month Hyatt’s CEO Mark Hoplamazian praised China’s handling of the Covid-19 outbreak and said that the country served as an example “that travel recovery is possible even without pharmaceutical treatments or a vaccine as long as proper, well-coordinated actions are taken to significantly reduce the spread of the virus”.

Hyatt and local partner Homeinns have also stressed that UrCove is very much designed with the Chinese traveller in mind, though Homeinns says it would also be keen to take the chain into other markets if it does well in China.

Homeinns already boasts 4,000 hotels in mainland China, while Hyatt has 70 in the Greater China region, with 30 more in the pipeline.

Hyatt said the occupancy rate in its hotels in mainland China has now returned to 65% of capacity.

During a recent earnings announcement Marriot said its mainland hotels were 60% full in July.


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