Shanghai, July 7, 2015 /PRNewswire/ -- On July 2, 2015, Powerlong Real Estate (HK.1238) announced that, in light of the rapid development of its hotel and tourism business, it has decided to establish the "Powerlong Hotel Group" on the existing foundation. Its main business will include: managed hotels, self-operated hotels, catering, and the management and operation of other tourism, agricultural sightseeing, KTV, arcade gaming, and other formats.
Powerlong's first five-star hotel in Shanghai -- Radisson Blu Hotel Powerlong (rendering)
This marks another strategically significant transformation for Powerlong Real Estate, following its "Hong Kong listing," the establishment of the "Shanghai-centered, deep cultivation in the Yangtze River Delta" development strategy, and the comprehensive upgrade of its product lines to capture community commerce. It is also a key component of a series of innovative upgrades and strategic adjustments as the company is about to enter its seventh year post-listing.
In an era where real estate has entered the "silver age," with business models transforming and diversifying across the industry, Powerlong has demonstrated farsighted strategic vision by gradually adjusting strategies across its five major sectors: commercial real estate, hotel and tourism, art and culture, industry, and information. By making frequent strides in each sector, the group has enhanced its overall strategic framework, achieving comprehensive, steady, and rapid growth.
Steady Development and Transition to a Light-Asset Operation Model
The development goals of the newly established Powerlong Hotel Group are very clear. "For the core businesses of the hotel group—self-operated hotels and self-created catering brands—we will focus on a light-asset approach, adopting leasing, franchising, or management contract models. We will develop these two brand lines through sale-leaseback of some of our own properties or by taking over properties developed by other developers. When the time is right, we will roll them out nationwide.".”said Xia Guoyue, General Manager of Powerlong Hotel Group.
The Powerlong hotel business has always adhered to the pragmatic and innovative spirit advocated by Chairman Xu Jiankang in its development and management. The profitability of its already operational hotels ranks among the top in the domestic industry. Against the national average initial investment return rate of 1-3%, Powerlong’s hotel segment has comprehensively achieved 6-8%. This is based on the pragmatic spirit of initial investment and subsequent operations, along with continuous innovation in product development and management, laying a solid foundation for the rapid growth of the hotel business.
From the early days when Xiamen Powerlong Hotel—one of the first five-star hotels in Xiamen—stood out with its entertainment experience, to Jinjiang Powerlong Hotel, which featured the largest conference and banquet facilities in Jinjiang at the time. Both hotels excelled in performance within their competitive categories. Clearly, Powerlong is not just a hotel developer but also an outstanding hotel operator. During Powerlong’s transition into commercial real estate, it introduced international hotel management brands, such as being the first to bring Starwood’s "Four Points by Sheraton" brand to third- and fourth-tier cities in China, making significant contributions to the development of Taicang and Tai’an, and establishing an early industry-leading position with RPI (Revenue per Available Room Index) far ahead of the second-place competitor in its competitive category, becoming a benchmark in the local hotel industry.
Independent Innovation to Build National Hotel Brands
Based on Powerlong’s strong control over hotel operations and its ability to deliver outstanding performance, and to meet the requirements of the group’s strategic development, the company has officially begun to focus on building its own hotel brands. This move aligns with the current trend of hotel chain development. Powerlong has chosen mid-range hotel series with strong operational capabilities and high investment returns to create a "Chinese national hotel brand."
On December 24, 2013, Powerlong took the lead in establishing its own hotel management company—"Powerlong Yijing Hotel Management Company." Through further optimization and independent innovation in hotel positioning, profit models, and architecture, it has developed a more competitive and profitable hotel model. This year, it will officially launch the "Yizhu" urban business hotel brand, and plans to introduce the "Yiyue" gallery-themed art hotel brand next year. This greatly supplements the hotel formats within Powerlong’s commercial real estate system and significantly enhances its competitiveness.
The uniquely created art hotel by Powerlong—the "Yiyue" gallery-themed hotel—will overturn and break through people’s traditional understanding of hotels and the industry concept. By integrating hotels with art, and distinguishing itself from the mixed bag of so-called art hotels or boutique hotels on the market, Powerlong’s gallery art hotel delivers an artistic experience not only on a material level but also on a spiritual one. Guests’ stays are not just an art tour but also an immersion where art touches the soul. The already opened Penglai "Powerlong Inn" hotel not only greatly enriches the format of the soon-to-open Powerlong Penglai Fairy Street but also serves as an attempt to explore a rental apartment model. Meanwhile, the official opening of the Qingdao Shaohai RV Park has also been a valuable experiment for Powerlong in exploring tourism real estate innovation and preparing for the upcoming RV boom in China.
Unique Holistic Experiential "Happy Dining"
Another core business of the Powerlong Hotel Group after its establishment is its self-created catering brands. Xia Guoyue, General Manager of Powerlong Hotel Group, explained: "According to the decision of the group’s leadership, Powerlong plans to independently develop more than 10 catering brands, to be launched in Powerlong community shopping centers and commercial streets nationwide. Powerlong’s self-developed catering brands are positioned as 'Happy Dining,' targeting consumers of different age groups and providing experiential dining services that align with the latest trends, such as parent-child, fashion, and business experiences."
Superior to the general catering offerings in community shopping centers, Powerlong’s self-created catering brands will have stronger community characteristics and be closer to the target consumer group. For example, they will offer a full range of experiences including gourmet tasting, cooking classes, food delivery, and at-home services. While enhancing the happiness index of community residents, they will also increase customer stickiness for the Powerlong Plaza. This is undoubtedly an important footnote to Powerlong Real Estate’s focus on developing community commerce.
Internet+ Integrated Big Data Sharing Platform
For the technical support of its hotel and catering brands, Powerlong has introduced the concept of "Internet+". By establishing its own management system and IT operation platform, and leveraging modern mobile internet and IoT methods, it will achieve headquarters control and unified operation of its nationwide hotels and catering with minimal labor and operational costs. It will also independently develop a loyalty customer management system, integrating it with Powerlong’s successful e-commerce platform—"Powerlong Online"—to share big data and integrate resources. Furthermore, it will connect with Powerlong Real Estate’s marketing platform to provide more premium and considerate services to customers who purchase properties in Powerlong developments.
Facing the new normal in domestic and international economic and political situations, the new landscape of the hotel and tourism industry, and major adjustments in the operating environment, this new round of innovation and transformation in Powerlong’s hotel and tourism business will surely lay a solid foundation for the future takeoff of Powerlong’s hotel industry and the enhancement of its commercial real estate competitiveness. We look forward to Powerlong’s independent hotel and catering brands entering the capital market in the future, adding highlights to the Powerlong Real Estate family.