THE Radisson Hotel Group (RHG) is pursuing partnerships with other hotel property owners in a bid to expand its footprint in the Philippines.
In a press briefing Tuesday, Andre de Jong, vice president for Operations, Southeast Asia and Pacific for the RHG, said, “We’re open to conversations with the right partners for the right opportunities.”
Since RHG’s entry in the Philippines in 2010, when it opened Radisson Blu in Cebu, and Park Inn by Radisson Davao in 2012, its main partner has been SM Hotels and Conventions Corp. Since then, it has opened three more hotels with SMHCC—Park Inns at Clark, Iloilo and North Edsa—with one more, in Bacolod City, in 2020.
However, it will be introducing its Radisson RED hotel brand in 2022 in Mandaue City, Cebu, which is a partnership with listed property developer Cebu Landmasters Inc.
He underscored the importance of the Philippines in their hotel portfolio, ranking third in the Asia Pacific region in terms of hotel rooms just behind China and India. By the end of RHG’s “transformational five-year plan” in 2022, it will have 1,491 rooms in the country, up from the current 1,198 rooms.
De Jong said the company was particularly encouraged by the growing number of visitor arrivals in the country. “The potential is significant, if you have 8.2 million international arrivals [target in 2019], which is 15 percent year-on-year growth. You need to acknowledge the potential; if you look at some of the other countries in Asia, their numbers are far higher. The Philippines has a lot of opportunity to grow that particular number.… But the big piece in all of this is domestic travel.
“With increased connectivity, improved infrastructure, a growing middle class with spending power, secondary and tertiary cities are easily reachable. Where travel becomes possible, these hubs will be created. So we see the opportunity in secondary cities,” he explained.
In 2018, foreign tourists grew by 7.7 percent to 7.1 million, and from January to September 2019, arrivals were up 14.4 percent to 6.1 million, per data from the Department of Tourism (DOT).
The number of domestic tourists, on the other hand, jumped 14.1 percent to 110 million in 2018, already exceeding the DOT’s domestic travelers target of 89.2 million for 2022.
About 70-80 percent of RHG’s market for its Park Inn hotels are domestic tourists, especially staycationers, said De Jong, while its Radisson Blu in Cebu has foreigners as majority of its guests.
Meanwhile, he said Radisson Blu in Cebu (400 rooms) has undergone renovation in the last one-and-a-half years and will soon be ready for more guests in 2020. That same year, Park Inn in Davao (204 rooms) will be slated for renovation.
Park Inn by Radisson in Clark is adding 100 rooms to the existing 154. By next year, it will be the biggest Park Inn by Radisson in the country in terms of rooms.
This year, RHG opened a Park Inn in Iloilo City (199 rooms), and at SM North Edsa (239 rooms) in Quezon City. The latter has 88 rooms currently open to guests, with the rest of its rooms coming on stream by 2020. A Park Inn will also open in Bacolod (153 rooms) next year.
In a previous interview, SMHCC officials revealed that Park Inn in Iloilo is the first hotel property under a “licensing agreement” with RHG. This allows SMHCC to manage the hotel itself, but with access to RHG’s international network. Its Park Inn in Bacolod will also open under a licensing agreement with RHG.
SMHCC also announced a Park Inn opening in Baguio City, but did not say when and how many rooms it would be. (See, “SM unit allots P8.2-B capex to expand, renovate hotels,” in the BusinessMirror, April 3, 2019.)
De Jong said RHG is hoping to enter the Palawan market if they find the right partner, and are cursorily watching out for opportunities in Baguio City and Bohol due to increased connectivity – something that is expected to increase demand for international accommodations.
The Jin Jiang Group of China now owns RHG, making the parent the second largest hospitality group in the world, with 12,000 hotels in over 120 countries. With the increasing outbound travel by the mainland Chinese and access to 150 million of Jin Jiang’s loyalty members, RHG sees its Chinese clientele growing for some of its properties in the country. In the first nine months of 2019, visitor arrivals from China grew by 39.43 percent to 1.36 million, making it the second largest market source for tourists, after South Korea, in the Philippines.
Image credits: Stella Arnaldo