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Hotels spy global opportunity in tourism boom
2017-03-13, PAUL WELITZKIN in New York

More Chinese than ever are traveling to the United States and other foreign destinations — and hotels in China are going with them.

In 2015, more than 2.5 million Chinese people visited the US, and that figure was expected to rise significantly last year, which was designated 2016 China-US Tourism Year.

One hotel group seeking to capture those tourists is Shanghai-based GreenTree Hospitality Group. It has five hotels in the states of Arizona and California.

Kevin Brooks, a co-managing director, said the company operates more than 2,000 hotels in China that range from budget or limited-service options to five-star designations. He said that a GreenTree budget or limited-service hotel in China is similar to a Holiday Inn Express in the US.

“About 18 months ago, the company decided to expand in the US, and last year, we converted five hotels to our brand,” Chris Petroff, co-managing director, said in an interview. “In 2017, we have embarked on franchising.”

Petroff said the company is hoping that existing franchise operators in China will consider a US location to help spread the brand.

Brooks said GreenTree intends to build on its familiarity in China to spur growth in the US. “We currently have a loyalty program in China that has 12 million paying members,” Brooks said. “We are seeing strong demand for US travel from that group.”

Driven by a rapidly growing middle class, Chinese outbound tourists are expected to reach 150 million in 2020 from 122 million in 2016, according to the China National Tourism Administration.

Travelers have many incentives for visiting other countries. In addition to a vacation, business or family considerations may require a trip from the Chinese mainland.

“There have been several articles on the growth of what is called the ‘beleisure’ group,” said Petroff. “That is a fast-growing segment that combines business and leisure travel by taking a week before or after a business trip to visit prominent places.”

Another growing segment of overseas travelers from China are parents sending children to study in the US, said Petroff.

Brooks said Alex Xu, the founder and chairman of GreenTree, sees the company as a global brand. “We are also exploring other countries in Asia and Europe for expansion,” he said.

In addition to traditional hotels, online marketplaces like Airbnb, which enables homeowners, renters and others to offer accommodation to travelers, are also expected to benefit from rising Chinese outbound tourism.

“To date, there have been more than 3.5 million guest arrivals by Chinese travelers at Airbnb listings all over the world,” company spokesman Nick Papas said in an e-mail. “While we have not focused on building our community in China, we’ve seen more and more Chinese hosts organically sign up to share their space. There have been nearly 1 million guest arrivals at Airbnb listings in China to date.”

Many of those are young people, especially the group referred to as millennials. According to a study for Airbnb conducted by research company GfK last fall, millennials surveyed in China, the US and the United Kingdom said that when they think about the next five years, traveling is as important as (or more important than) buying a home, paying off debt, or purchasing a car.


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