The oversupply is of rooms, not guests. Executives of Starwood Hotels & Resorts Worldwide (which includes Westin, Sheraton and several other brands) now hope an oversupply of rooms this year will quickly turn around and normalize in countries like China by 2011.
Miguel Ko, chair and president of the US-based hotel giant’s Asia-Pacific division, said the global economic downturn is partly to blame for the lack of business and international travel.
He also referred to the addition of new rooms built for the 2008 Olympics in Beijing and the Shanghai World Expo in 2010 contributing to the oversupply in China.
Ko said cities such as Beijing and Shanghai with large numbers of international travelers are bearing the brunt of the recession, especially among financial sector travelers. (The illustration is of the Westiin Guanzhou which suffered somewhat along with all the rest of them.)
Business travel volumes for Starwood hotels in Beijing and Shanghai fell by 25% year-on-year during the first six months of this year, Ko said, describing the numbers as "slightly better" than Starwood’s competitors.
According to the National Tourism Administration, the year-on-year number of inbound travelers to China fell by 4.8% to 52.1 million during the first five months of this year.
After signing 29 new hotels in China last year, Starwood already has signed 11 more this year and plans to sign another 10 before 2010.
China Daily reports that Starwood has 960 hotels in 97 countries, including 140 hotels in the Asia-Pacific region.
The company anticipates a 40% increase in the number of Starwood hotels within the next five years.