Testy Times for Hotel Chains and Owners – Skift

There was a time when the big global hotel chains owned hotels or had some equity in them. They were fond of saying they were not just an operator but an owner, hence they could run the business better than an operator only, since they understood being both.

Now everyone’s gone asset-light and why not — less risk, low capital, high cash. Even in bad times, the management fees would roll in as chains keep signing up new hotels.

Who’d blame the Asian owner for being mind-boggled: “Hey, my RevPAR (revenue per available room) is down, and you’re adding more hotels to compete with me?” Or for losing sight of the fact that chains — like online travel agencies with whom owners also have a love-hate relationship — do have to keep investing on customer acquisition, technology, brand building, and more in order to win over guests for owners.

Tempers have flared all the way to court, as our report below on The Peninsula Bangkok, and recent reporting on JW Marriott Phuket, shows. With the trade war and Hong Kong protests showing no signs of resolution, a couple more legal cases should not come as a surprise to anyone.

To avoid them, chains must be more sensitive to owners — and do more. What, for example, are they doing to help owners in Hong Kong, apart from consoling them that Hong Kong will come back one day?

After all, at one time chains were owners.

Or so they said.

— Raini Hamdi, Skift Asia Editor, rh@skift.com, @RainiHamdi

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Asia Editor Raini Hamdi [rh@skift.com] curates the Skift Asia Weekly newsletter. Skift emails the newsletter every Wednesday.

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