Ascott, Jin Jiang partner for asset-light China growth

SINGAPORE — The Ascott Ltd. is entering a 50-50 joint venture with Shanghai-based Jin Jiang Hotels to advance asset-light expansion of their respective brands in China, namely Ascott’s Quest and Jin Jiang Hotels’ Tulip Lodj.

The joint venture will primarily use a franchise model to help meet China’s underserved demand for apartment hotels in the upscale and upper midscale segments. The JV also announced it would immediately manage two properties in Wuhan and one pipeline property in Shenzhen, which is franchised under Tulip Lodj and will total about 600 units. The JV plans to broaden the footprint of Tulip Lodj and launch Quest in China.

“The collaboration will accelerate our asset-light expansion in China by leveraging Jin Jiang’s franchise-ready infrastructure, complementing our successful management strategy in the market where we currently operate more than 220 properties in over 40 cities,” said Kevin Goh, CEO of Ascott and CLI Lodging. “With 90% of Ascott’s global portfolio already operating under management and franchise agreements, we remain focused on advancing our asset-light strategy for further growth.”

Goh said Quest is Australasia’s leading apartment hotel brand, and the company sees tremendous growth potential in China. He said recent research has indicated that 68% of new hotel signings in China in the first half of 2024 are franchise contracts, which is up from 61% a year ago and above the average of 62% in regions outside the Americas.

“Our plans to establish Quest’s brand presence in China align with our overall growth strategy and reinforce our commitment to maximizing the value of Ascott’s acquisition of this esteemed brand,” Goh said.

Ascott is the lodging business unit wholly owned by Singapore-based CapitaLand Investment. Jin Jiang is China’s largest and the world’s second-largest hotel group, with about 13,250 operating hotels and over 1.34 million rooms.

Properties under the JV will join the distribution networks and loyalty programs of both Ascott and Jin Jiang Hotels. Guests of both programs can earn and redeem points with either program when booking at Quest and Tulip Lodj in China.

“As franchising becomes an increasingly important business model in China’s hospitality industry, the joint venture is well-positioned to leverage the established franchise capabilities of both Ascott and Jin Jiang Hotels to fuel new growth,” said Wang Wei, CEO of Jin Jiang Hotels (China Region). “Harnessing our respective strengths through this partnership, we look forward to helping both Tulip Lodj and Quest achieve significant growth in property numbers and brand influence in China and providing guests with diverse, high-quality stay experiences.”