(Yicai Global) Aug. 5 -- BTG Homeinns Hotels Group has opened its first PuYin Hotel in Shanghai and plans to cut the ribbon on many more of the upmarket establishments over the next five years.
BTG Homeinns plans to have 100 PuYin brand hotels after opening the latest one in the Lujiazui central business district of Shanghai yesterday. The Beijing-based budget hotel chain operator intends to shift into the mid- to high-end segment in the coming three to five years.
PuYin will open mainly in cities directly under the central government or provincial capitals and prioritize CBDs when choosing locations. Apart from Shanghai, PuYin already has around 10 hotels in Xi’an, Chengdu, Xiamen and other cities.
“We’ll open more PuYin hotels using the franchise model or by revamping old hotels,” BTG Homeinns General Manager Sun Jian told Yicai Global. “The proportion of budget hotels among the firm’s 4,000-plus hotels is declining, and we’ll make continuous efforts in the mid- to high-end hotel sector.”
BTG Homeinns’ hotels focus on modern fashion style, but the PuYin brand specializes in classicism and provides business travelers with diversified choices, Sun added.
The coronavirus pandemic has hammered the hotel sector. It now faces massive challenges in the form of occupancy rates and cash flow, leading to a diminished return on investment, Sun said.
“Low-priced hotels also have rising costs and their ROI will suffer if they cannot improve their profits, while higher-priced mid- and high-end hotels are better off, which generates higher ROI for their partners,” he said.
BTG Homeinns’ occupancy rate is picking up rapidly as domestic tourism revives and business travel rebounds, Sun said, adding that revenue per available room has been restored to between 75 percent and 80 percent of the level before the virus outbreak.
State-backed BTG Hotels Group bought and merged with Shanghai-based Homeinns Hotel Group to become BTG Homeinns in 2015. Homeinns Hotel Group delisted from the Nasdaq stock market and is China’s third-largest chain hotel operator after Shanghai Jin Jiang International Hotels and Huazhu Group.
Editors: Dou Shicong, Peter Thomas