Will be operated under its own brand

Recently, there are market rumors that due to the serious losses of Hotel Indigo Shanghai Hongqiao, its owner Fang Longhu Group sent a termination letter to Liuzhou Hotel Management Company, a subsidiary of InterContinental Hotels Group, the operating manager, demanding that it be terminated as soon as possible Negotiate store closures and plan to cease operations of Hotel Indigo Hongqiao from August 10. Hotel Indigo Shanghai Hongqiao is a component of the landmark Longfor Tianjie complex in Hongqiao Business District. It is a self-owned property of Longfor. It is located in the core area of ??Hongqiao Business District and has a total of 227 guest rooms. According to market news, Hotel Indigo Shanghai Hongqiao has suffered serious losses in every actual operating year since its opening in September 2018, resulting in a cumulative profit loss of more than 50 million yuan, and the gross profit over the years has not reached the level agreed between the hotel and the owner. Confirmed annual budget targets. In response to this news, Longfor told China Business News that the termination of the contract with Liuzhou Hotel Management Company for the Hongqiao Hotel Project was true, but it did not disclose any more information on the details of the termination. The reporter learned that the hotel will not be closed. After the contract is terminated, Longfor will renovate and upgrade the hotel's brand and business format, switching from entrusted management to independent operation. "Due to the epidemic, Hongqiao's hotel industry, whose customer base is business travelers, has been greatly affected. However, as Shanghai accelerates economic recovery and revitalization, more and more companies and business people are coming and returning to Shanghai. Longfor wants to use a more flexible strategy To operate the hotel, there is a high probability that it will choose to operate it independently to provide supporting services for business people such as entrepreneurs and executives in Shanghai, so that the cost will be more controllable. "An insider close to Longfor revealed that it is expected to be as early as March this year. At the end of the quarter, the hotel will be re-entered the market under Longfor's own new brand. According to Qichacha, the partner Liuzhou Hotel Management Company is 100% owned by the British InterContinental Hotels Group and is wholly foreign-owned with a registered capital of US$13 million. It was established in 2004. The hotel brand "Indigo" is a high-end boutique line under the InterContinental Group. It was founded in 2004 and entered the mainland Chinese market in 2010. InterContinental Hotels Group is the world's largest hotel management company with the most hotel brands. After the outbreak of the global COVID-19 epidemic in 2020, the group's performance was greatly affected. Its public financial report disclosed that in 2019, InterContinental Hotels Group's total revenue was US$4.627 billion and profit was US$385 million. However, in 2020, total revenue was almost halved, falling to US$2.394 billion, and net profit fell by 167%, with a loss of US$260 million. Dollar. Total revenue in 2021 has increased slightly, reaching US$2.907 billion, but it is still far behind before the epidemic. At the end of July, InterContinental Hotels Group disclosed that its revenue per available room in Greater China recovered to more than 80% of the same period in 2019 in early July, but only recovered to 60%-70% in East and North China. A hotel industry observer told China Business News: "The owner Fang Longhu may no longer be optimistic about the operation model of this single store in the past. After all, the market environment has undergone major changes." As the core transportation hub of the Yangtze River Delta, Greater Hongqiao has always had relatively large There is a huge demand for tourist accommodation, but this demand has obviously decreased in the short term due to the continuous intrusion of the epidemic. On the other hand, business people's demand for accommodation still has considerable room for development and is accelerating its recovery. According to data disclosed by the Hongqiao International Central Business District Management Committee, Hongqiao Business District has introduced more than 400 headquarters companies in 2021, gradually becoming a gathering place for domestic and foreign headquarters companies to develop, and the number of resident corporate managers and business travelers continues to grow. Longfor said that it will sensitively grasp the market and focus on brand and service changes for the influx of business people.