Starwood Hotels & Resorts Predicts Strong Year of Growth in 2013
By Claudette Covey
January 09, 2013 10:34 PM
Starwood Hotels & Resorts announced that, building on its 2012 momentum with the most hotel deals signed since before the global economic crisis, it anticipates a strong year of openings and new hotel agreement signings in 2013. Over the last five years, Starwood has cultivated a quality pipeline of new hotels with well-capitalized, experienced owners for continued growth around the globe.
“Rising wealth, increasingly global businesses and a digitally connected world are creating unprecedented demand for travel and new travel patterns, and we continue to be as bullish as ever about our long-term growth,” said Frits van Paasschen, president and CEO. “Whether it’s manufacturing in Vietnam, mineral resources from Nigeria, or outbound tourism from Brazil, Russia, India or China, globalization is spurring economic development and creating many exciting expansion opportunities for our business.”
“After a strong year in 2012 of openings, deal signings and increased owner interest in development, we are entering 2013 well-positioned for continued footprint growth in both emerging and developed markets,” said Simon Turner, president of global development. “Our long-established global presence remains a competitive advantage, and our local teams provide know-how and strong relationships paving the way for future growth and the continued expansion of our nine brands. In 2012, Starwood signed a total of 131 new hotel management and franchise agreements which represented an increase of 17 percent over 2011 signings levels, including 31 conversions, 12 of which opened during 2012.”
Consistent with macroeconomic growth trends, nearly two-thirds of Starwood’s new hotels in 2013 will open in fast-growing markets. Starwood plans to open its first property in Tajikistan, while also expanding further in such important markets as Peru, Brazil, Mexico, Panama, Malaysia, Singapore, Thailand, Vietnam, Bangladesh, Hungary, Turkey and Saudi Arabia, as well as perennial growth markets like China and India. The company will also continue to focus on identifying the right partners for continued development in Brazil, Russia and throughout sub-Saharan Africa. Asia remains a high-priority market for Starwood, accounting for approximately one-quarter of Starwood’s existing hotel rooms and over half of Starwood’s pipeline.
“Our owners are uniquely positioned to benefit from Starwood’s global presence, scale, powerful systems and strong, growing base of loyal customers around the world,” said van Paasschen. “As part of our balanced approach to development, we are also seeing significant opportunities in established markets where conversion momentum continues, and record low supply and growing demand are driving growth.”
Starwood is continuing to build on its established presence in mature markets and to see strong interest in conversions for growth in developed markets such as North America. The company expects to see increased conversion momentum in 2013 in Asia Pacific, Latin America and Europe.
Starwood is also continuing to lengthen its lead in the luxury space with more than 150 properties in its luxury portfolio under the St. Regis, Luxury Collection and W Hotels brands, and remains uniquely positioned to capitalize on the increasing number of people around the world developing the means and appetite for luxury travel. Over the past five years, Starwood nearly doubled its global luxury footprint. Fifteen percent of Starwood’s pipeline of new hotels are in its luxury portfolio, including an impressive pipeline in Asia Pacific and many conversion opportunities that exist around the world as independent, boutique hotels look to benefit as part of the Starwood system.
In 2013, Starwood will celebrate the opening of The St. Regis Abu Dhabi and the re-openings of two luxury icons and members of the Luxury Collection, the Gritti Palace and Prince de Galles, after significant, multimillion-dollar restorations. New openings for the Luxury Collection include The Castle Hotel, Dalian (China); Vana Belle, Koh Samui (Thailand); and Palacio del Inka (Peru). Starwood will open its first W Hotel in mainland China with W Guangzhou and the first W alpine ski resort with W Verbier (Switzerland).
This year will be a strong year for Starwood’s upper upscale brands, Sheraton, Westin and Le Méridien. Sheraton has been a first mover into many new markets around the world, and will continue to fuel Starwood’s growth with nearly 20 planned openings in 2013, a historic number of openings as the brand moves towards its milestone 500th opening in 2015. Sheraton remains a leader in China with 57 hotels now operating and another nine expected in 2013.
Westin is also experiencing meaningful growth around the world and expects to open its 200th hotel this year. Expected openings for 2013 include The Westin Birmingham (U.S.); The Westin Chennai Velachery (India); The Westin Houston Downtown (U.S.); The Westin Haikou (China); The Westin Sanya Haitang Bay Resort (China); The Westin San Jose (U.S.); The Westin Chongqing Liberation Square (China); The Westin Qingdao (China); and The Westin Singapore Marina Bay (Singapore). After a significant investment in its hotels, Le Méridien is benefiting from growing brand recognition and deal signing momentum around the world. Planned 2013 openings include Le Méridien Dallas, The Stoneleigh (U.S.); Le Méridien Atlanta Perimeter (U.S.); Le Méridien Zhengzhou (China); Le Méridien Saigon (Vietnam); Le Méridien Dhaka (Bangladesh); Le Méridien Cairo Airport (Egypt); Le Méridien Mahabaleshwar Resort & Spa (India); and Le Méridien Jiaonan Resort (China).
Starwood’s mid-market portfolio, which includes Aloft, Element and Four Points by Sheraton, has grown more than 60 percent since 2009, reflecting the brands’ worldwide appeal. This is a direct benefit from Starwood’s longstanding tenure and teams in key global markets where there are significant growth prospects -- particularly in secondary and tertiary markets -- and meaningful guest, customer and owner appetite for affordable and reliable global hotel brands. Starwood will open its 250th mid-market hotel this year. The three brands account for approximately one-third of the company’s global development pipeline and nearly 45 percent of expected hotel openings worldwide in 2013.
Four Points, which represented more than a quarter of Starwood’s openings and signings last year, is set to open its 175th hotel and is expected to sign more deals in 2013 than ever before in the company’s history, driving growth throughout the world. Aloft is also being fueled by great global momentum, and plans to grow its portfolio by nearly 30 percent in 2013, and celebrate its 75th hotel, driven heavily by openings in China, North America and India. The brand is benefiting from a desire for design-centric, hotel brands around the world at an affordable price. Aloft is growing through an increased number of conversions, and will debut in Panama, Malaysia and Turkey during the year. Element will open its first hotel outside of the U.S. with its debut in Canada this summer followed by the brand’s debut in Europe in 2014.