APAC Hotel Management Terms Rise to 17 Years on Average

JLL and Baker McKenzie published a study, Hotel Management Contract Survey 2024, with the major findings including that the initial term of hotel management agreements in Asia Pacific increased by four years on average since 2025, reaching 17.4 years in 2024. Regional operators generally have a shorter term and an appetite for more flexibility. The survey comprised 400 hotel management agreements analyzed over the past 20 years and included 145 hotel management contracts signed between 2018 and 2023. The length of the HMAs differ by market, with Maldives and Japan at 26 and 23 years, respectively, where there are a higher number of luxury hotel developments and owners prefer to lock in brands for longer. Australia is more tailored to shorter agreements with an average of 15 years as owners prefer shorter terms and unencumbered asset sales. The make-up of fees is a factor influencing the duration. The survey showed the average base fee in contracts has come down to 1.6% of revenue from 1.7%. Incentive fees are increasingly based on a sliding scale based on performance against gross operating profit thresholds. While management fees have declined, the survey affirmed that sales and marketing fees have increased with a higher proportion of operators charging sales and marketing fees at 3% or more of either Rooms Revenue or Total Revenue. 93% of contracts now include performance termination provisions. Expectations for the future from the survey respondents include a rise in alternative operating models, sustainability influence and room for terminations.

JLL's Hotel Investment Trends in India for H1 2024 said the hospitality sector recorded US$93 million in investment activity in the first half of 2024. JLL said India could close at a projected US$413 million, marking a 22% increase compared to 2023. Listed hotel companies dominated the transaction landscape, accounting for 44% of the total investment volume. Owner-operators followed with 30% and high net worth individuals, family offices, and private hotel owners contributed 26% to the total transactions. Of the total transaction volume, 72% involved operational hotels, 23% were under-construction properties and the remaining were related to land leases. The first 6 months of 2024 saw six significant hotel transactions across Tier I and leisure markets, including land leases for greenfield development in key airport districts. The second half of the year already had two major transactions facilitated by JLL, totaling US$70 million. A total of 19,442 hotel keys were signed in 1H24 with 83% located in Tier II and III cities. Management contracts constituted 89% of the signings. Franchises were 8%. The number of greenfield projects totaled 13,700 keys signed, surpassing the whole total of 2023. The midscale segment captured the largest share of the 6,071 keys added through new hotel openings in the first half of the year with 46%. The upscale segment followed with 29%.

The Philippines Dept. of Tourism said international visitor arrivals rose by 10.9% in the first eight months of the year to 3.3 million. Including overseas Filipinos, that number rose to nearly 3.7 million, up 10.1%. In August alone, international visitors totaled 428,537. South Korea remained the primary source of inbound tourists with 1,078,063 arrivals recorded during the first eight months of the year. The US was second with 637,592.

Minor Hotels announced plans to launch its Avani Hotels & Resorts lifestyle brand in Singapore, marking the group's entry into the country. The 13-story Avani Singapore is scheduled to open in the first quarter of 2027. Minor partnered with Singapore's Kajima Development and Abu Dhabi-based Alwathba Investment on the planned 200-room hotel to be developed in the heart of Tanjong Pagar district.

Seibu Prince Hotels and Resorts announced the launch of its first Park Regis by Prince brand hotel in Singapore. The Park Regis Singapore was rebranded as Park Regis by Prince Singapore on September 3rd after Seibu completed the refurbishment of the 203 hotel rooms. The launch marks the entrance of Seibu Prince Hotels and Resorts into Southeast Asia after the hotel chain acquired Staywell Hospitality Group in 20217.

Oasia Resort Sentosa by Far East Hospitality unveiled a new room category, Courtyard Premier, alongside the hotel's refreshed Junior Suites. The 19 Courtyard Premier rooms are located on level two in the Palawan Wing with each room spanning 63 square meters. The 62 refreshed Junior Suites are housed in the heritage building known as the Wellness Sanctuary of the two annexes. Oasia Resort Sentosa is one of four hotels in the Sentosa precinct in Singapore by Far East Hospitality.

Amora Hotels & Resorts is accelerating expansion across Australia as it introduces its five-star hospitality brand. Amora currently operates three hotels in the country with the latest being Amora Hotel Brisbane, which launched in March 2024 after a US$16.4 million renovation and rebranding of an existing hotel. The company is pursuing an ambitious strategy to establish a presence in the center of every state capital within five years. The growth is being driven by Tamer Habib as VP of Operations. He was formerly a senior executive with Starwood, Rydges and Stamford Hotels & Resorts.

Centara Hotels & Resorts has continued its expansion in Southeast Asia with several new properties in Thailand and Vietnam. Centara Ayutthaya, Centara Ubon, Centara Life Lamia Resort Samui, Centara Mirage Lagoon Maldives and Centara Grand Mirage Beach Resort Pattaya are the new or renovated properties from the Thailand-based company.

Marriott has opened the all-new Westin Bora Bora Resort & Spa in French Polynesia following an extensive renovation and rebrand of the former Le Meridien Bora Bora. This is the first new resort to open in Bora Bora since 2017. The hotel includes 128 overwater bungalows, many with private plunge pools. The resort also features beach villas, six outposts for food and beverage operations and an entire wellness area that includes both the Heavenly Spa and Westin Workout Fitness Studio.

Travellers International Hotel Group, operator of Manila's Newport World Resorts, is said to be considering a new US$300 million integrated resort development in Cebu, Philippines. SunStar Cebu reported that this project was presented to the local government late last month. The IR will be called Mactan World Resorts and would be located in the 30-hectare Mactan Newtown township currently being developed by Megaworld Corp about 20 minutes form Mactan-Cebu International Airport. Megaworld and Travellers are units of Alliance Global Group. Mactan World Resorts would include a hotel and casino.