Shanghai, July 12, 2017 — Recently, Shimao Group and Starwood Capital Group announced a strategic partnership to establish a new joint venture hotel company — Shanghai Shimao Star Hotels Management Co., Ltd. (hereinafter referred to as “Shimao Star”). On July 11, the newly established Shimao Star Hotels Management Company held a grand press conference in Shanghai that garnered significant attention. Behind Shimao Star are two powerhouse entities — on one side, Shimao Group, a leading enterprise in China’s real estate sector, and on the other, Starwood Capital Group, a world-leading private equity firm. As such, the event attracted numerous industry professionals and media representatives.
“As a leading enterprise in China’s real estate industry, Shimao Group takes its corporate social responsibility seriously and fully supports the government’s macroeconomic development strategies,” said Mr. Xu Shitan, Vice Chairman of the Board of Directors of Shimao Group, during his speech at the press conference. “Leveraging our own strengths, Shimao Group will collaborate with internationally top-tier real estate private equity firms such as Starwood Capital to develop the next generation of mid-to-high-end hotel market and bring Chinese hotel brands to the global stage.”
Mr. Xu Shitan, Vice Chairman of the Board of Directors of Shimao Group, delivers a speech
Shimao Star Expands into the Next Generation of Mid-to-High-End Hotel Market
Following the rebound of China’s PPI in September 2015, which has maintained high growth over the past two years, the recovery of China’s macroeconomy is being validated. Both domestic business demand and mass tourism consumption have shown signs of stabilization and recovery. Against this backdrop, both established domestic hotel brands and international high-end hotel chains have been actively deploying strategies through acquisitions and mergers to integrate market resources and further penetrate the mid-to-high-end market.
On March 28, 2017, Shimao Group and Starwood Capital Group officially signed a cooperation agreement. According to the terms, Shimao Group will hold a 51% stake in the new company, while Starwood Capital Group will invest and acquire a 49% stake. The industry widely believes that the establishment of Shimao Star marks a milestone in the development of China’s hotel industry, demonstrating strong global capital interest in the Chinese hotel market, as well as the vast growth potential of Shimao Hotels both domestically and internationally.
Group photo of guests at the launch ceremony of Shanghai Shimao Star Hotels Management Co., Ltd.
Starwood Capital Group Chose Shimao Group as Its Partner to Enter the Chinese Market, While Shimao Group Is Poised to Expand Globally. Currently, Shimao Star has launched six distinctive hotel brands: the luxury five-star resort “Yuyuan Manor,” the five-star business hotel “Moyu,” the business hotel “Shiyu,” the high-end serviced residence “Moyu Residence,” the premium concept hotel “Rui Xuan Premium,” and the concept hotel “Rui Xuan.” Moving forward, Shimao Star will focus on developing its own branded hotels, with plans to concentrate on China’s rapidly growing hotel market by engaging in hotel development, brand operations, and asset management.
““Walking with Dreamers” Conveys Shimao Star’s New Philosophy
At the press conference, Shimao Star shared its corporate pursuit of “Walking with Dreamers” with attending media and guests: Shimao Star pledges to provide a warm and comfortable haven for guests chasing their dreams; to help property owners realize their dream of owning a hotel; and to offer a platform for employees to pursue their ambitions. At the same time, Shimao Star also communicated its corporate values of “Craftsmanship, Integrity, and Integration.” According to Mr. Tang Ming, President of Shimao Star, craftsmanship represents the company’s dedication to details in hardware, artwork, and services — a principle upheld throughout the entire Shimao Group. Integrity and trustworthiness are Shimao Star’s promises to guests, property owners, and employees. Bringing together various strengths, integrating with the outside world, learning from each other, and achieving mutual success represent the highest aspirations of Shimao Star.
“In our collaboration with Shimao Group, we found a strong alignment in hotel management and operational philosophies, as well as significant complementarity in branding, regions, and customer base,” said Mr. Kevin Colket, Managing Director of Starwood Capital Group and Head of Asia Hotel Division. To meet the increasing accommodation needs of Chinese travelers, Starwood Capital will work together with Shimao Group to provide diverse lodging experiences and is committed to making Shimao Star one of the most outstanding hotel groups in China and even the Asia-Pacific region.
At the press conference, Shimao Star also held a signing ceremony for eight brand-output-managed hotels. Mr. Tang Ming, President of Shimao Star, personally presented the “Dream Partner” trophy to the property owners, welcoming them to join the “dreamers” of Shimao Star and work together for a shared future. Mr. Tang promised, “With a background as property owners ourselves, we have a deeper understanding of the needs of hotel investors. With a professional management team, standardized operational systems, and the strong backing of Starwood Capital, Shimao Star will fully support the signed hotels in maximizing profits. Our goal is to achieve a win-win situation and deliver investment returns that exceed the expectations of hotel investors.”
Signing Ceremony for New Projects of Shanghai Shimao Star Hotels Management Co., Ltd.
About Shimao Star Hotels Management Co., Ltd.
Shanghai Shimao Star Hotels Management Co., Ltd. (Shanghai Shimao Star Hotel Management Co., Ltd.), established in 2017, is a new joint venture hotel company formed by Shimao Group and Starwood Capital Group, with majority control by Shimao Group. Shimao Star Hotels Management Company is committed to developing its own branded hotels, with business operations covering six hotel brands, each targeting different market segments, including Yuyuan Resort, Yuluxe Hotel, Yu Hotel, Yu Residence, as well as MiniMax Premier and MiniMax. Currently, Shimao Star Hotels Management Company operates six branded hotels nationwide, with a total of nearly 1,200 guest rooms.
In the future, Shimao Star Hotels Management Company will focus on managing and exporting its own branded hotels as its core business. With attractive profit returns, a professional management team, and broad development opportunities, the company aims to become an international hotel group.
About Starwood Capital Group
Starwood Capital Group (Starwood Capital Group, abbreviated as SCG), founded in 1991 in the United States, is an internationally renowned real estate fund management company. Its investment scope spans globally across real estate, energy, infrastructure, and oil & gas. It has 10 offices and more than 2,200 employees across multiple countries worldwide. To date, Starwood Capital has raised over $41 billion in capital and manages assets worth more than $55 billion, covering various sectors of global real estate investment. With its flexible investment approach, Starwood Capital adapts to shifting trends and emerging opportunities in the global capital markets. Over the past 26 years, Starwood Capital has successfully applied its investment strategies to a wide range of private and public market mergers and acquisitions, as well as brand operations.