Starwood to Open 20 Hotels in China in 2013

Starwood will open 20 new hotels in China in 2013.

Having doubled its footprint there in the last three years, Starwood has 120 hotels open and more than 100 in the pipeline, making China not only the company's fastest growing, but also the second largest hotel market behind only the United States.

Starwood President and CEO Frits van Paasschen who is in China this week participating in the Fortune Global Forum in Chengdu said the company will open one new hotel every 20 days in China and that 70% of its pipeline of new hotels under construction and in development are in second and third tier cities.

"We continue to view China as a once-in-a-lifetime opportunity for our business," said van Paasschen. "Whether it's growing our hotel footprint as part of the country's massive infrastructure development, or aggressively building our loyalty program in the world's fastest growing domestic and outbound travel market, we are focused on taking every advantage of our important first-mover position in China."

Starwood's presence in China dates back to 1985 when the Sheraton Great Wall Beijing opened. Today, Starwood is one of the largest high-end hotel operators in China. In 2012 Starwood opened 25 hotels and signed 36 new hotel deals - a record number of openings and deals.

According to the UN World Travel Organization (UNWTO), China is now the world's number one tourism source market in terms of spending, surpassing Germany and the United States. In 2012, China's expenditure on travel abroad reached US$102 billion.

China is now Starwood's second largest source of travelers behind only North America and in 2012 outbound Chinese travel to its hotels grew by 20%. Already the largest feeder market to Starwood hotels in Asia, China is by far the company's fastest growing travel market.

According to van Paasschen, accelerated Chinese outbound travel is impacting business around the globe, and last year 95% of Starwood's hotels across nearly 100 countries welcomed guests from Greater China.

Just as important as opening new hotels, Starwood is focused on cultivating loyalty among China's new mega travelers. Since 2010, the company has doubled its base of active travelers in Starwood Preferred Guest (SPG), the company's loyalty program. Growth in SPG's base of travelers continues to grow at a rapid pace, and today, SPG enrolls a new member every 20 seconds in China, and elite gold and platinum members who stay 25+ nights a year are up 53% over last year. Globally, 50% of Starwood's guests are SPG members, and in China, 55% of rooms are filled through SPG.

Domestic Travel

Chinese domestic travel also continues to rise. Starwood's hotels in China are no longer just outposts for Western travelers, and today 50% of guests at hotels there are Chinese. More and more, Starwood and its owner partners are developing hotels in China with the domestic traveler in mind, including new resort products to meet the demands of an increasingly affluent local market with the means and desire to travel. Starwood will soon have more resorts in Hainan Islands (often referred to as China's Hawaii,) than it does in Hawaii. Likewise the company has opened new ski resorts in China such as the Westin and Sheraton resorts in Changbaishan and also urban retreats including the Sheraton Huzhou and the nearly 4,000-room Sheraton Macao, Starwood's largest hotel anywhere in the world.

Starwood to Fill 10,000 New Positions a Year in China

Over the next five years Starwood will more than double its number of staff in China with 10,000 new hires each year.

Within Starwood's hotels in China, one third of its General Managers and 79% of its hotel senior Executive Committee leaders are Chinese.