BEIJING, October 9 (TMTPOST) — Chinese real estate developer Sunac China has transferred the management of its 22 hotels in 11 Chinese cities to Huazhu Group after it terminated the management authorization agreement with Wanda Hotel Development. The hotels will change their brand from Wanda to Yongle Huazhu.
Source: Visual China
The hotels will maintain normal operation while the process of brand change takes place gradually. The 22 hotels are all located in China’s first-tier and second-tier cities, and tourist destinations, including Guangzhou, Chengdu, and Xishuangbanna. Huazhu will reportedly design brand strategies for the hotels in accordance with their style,
Yongle Huazhu is a light-asset hotel management joint venture funded by Sunac Culture and Tourism and Huazhu Group on March 22, 2021 with registered capital of RMB50 million. Sunac Culture and Tourism and Huazhu Group both hold a 50% stake in the joint venture. The brand currently has over 60 hotels and around 12,000 hotel rooms. The company specializes in high-end and luxurious hotel and resort management. The high-end hotels and resorts that the company operates include Steigenberger Icons Hotels, Songpin, and Blossom House, etc.
Wanda Hotel Development received a notice from Sunac China, informing the company that it will terminate the hotel management agreement with Sunac China due to the impact of the COVID-19 pandemic and the company’s adjustment of business strategy, according to Beijing News’ report. Wanda Hotel Development’s notice shows that the 21 hotels that are covered in the agreement include 19 operating hotels and 2 hotels under construction. The hotels are located in Xishuangbanna, Nanchang, Hefei, Qingdao, Guangzhou, Wuxi, Chongqing, Chengdu, Guilin, and Kunming, etc. Harbin Sunac Wanda Jiahua Hotel’s management will also be transferred to Yongle Huazhu.
As a result, Sunac China will pay Wanda Hotel Development a total sum of RMB133 million as compensation and RMB68.59 million for completing pending transactions ending on June 30, 2021 with Wanda.