Hilton Hotels, RREEF and H&Q Asia Pacific sign Intention to Introduce Focused Service Hotels to China

Travel News Asia Tuesday, 12 December 2006

Hilton Hotels, RREEF (the real estate and infrastructure investment management arm of Deutsche Bank) and private equity firm H&Q Asia Pacific (H&QAP) are planning to form an alliance to initially introduce more than 20 focused service hotels across China.

Hilton Hotels Corporation, RREEF and H&QAP have signed a Letter of Understanding for RREEF and H&QAP to form a partnership to acquire, develop and convert sites for around 5,000 new rooms under Hiltons burgeoning focused service hotel brand, Hilton Garden Inn. Hilton Hotels Corporation would subsequently provide expertise in site selection, development, training, operations support, brand management and marketing.

Locations being considered for the hotels include, but are not limited to Shanghai, Beijing, Tianjin and key urban centres within the Yangtze River Delta and Bohai Bay regions. These regions represent many of the faster growing economies in China.

Hilton Garden Inn properties provide high quality focused service and facilities to business and leisure travelers at a competitive price. According to Ian Carter, executive vice president, Hilton Hotels Corporation and CEO of international operations, China represents an attractive, large and rapidly growing market for this brand.

China is an outstanding market whose booming economy and growing tourism both domestically and in-bound will ensure a strong demand for focused service hotels. This strategic relationship with two very experienced specialists would allow Hilton to rapidly roll out our first focused service hotel brand in China. This initiative is in line with our aim to be a leader in the focused service hotel sector in Asias key growth markets. These Hilton Garden Inn hotels will be a significant addition to our existing business in China, where we already operate five Hilton hotels, said Mr. Carter.

This move follows RREEFs entry to Chinas real estate market last month via its investment in a mid-market, residential project in Zhuhai, southern China. Together with three local co-investors, RREEF will develop a US$225 million residential project to provide more than 2,000 affordable apartments to primarily local middle class owner-occupiers.

We believe long-term prospects for real estate market fundamentals in China are very good and are proactively pursuing investment opportunities which are supported by Chinas long term economic growth prospects, rising middle class and urbanization, said RREEFs Head of Acquisitions, East Asia, Brian Chinappi. Were very positive on the focused service business and leisure travel sector in China, where there is limited supply of branded product and growing demand. We are pleased to be working towards a partnership with such experienced sector experts as Hilton and H&Q Asia Pacific.

See other recent news regarding: Hilton Hotels, China

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