hollywood billionaire

Chapter 447 Banyan Tree

"To be honest, I don't think Banyan Tree deserves your attention."

Three hours after Jordan Bromley left 864 Stradella Road with a series of work tasks, the discussion about this series of projects has not subsided.

Sitting at the dining table, fiddling with the remaining boiled green beans in the white porcelain plate, Xu Yiru seemed very interested.

Although she didn't drink any alcohol at dinner, her face was flushed strangely.

"There are currently only 25 branches and 2698 rooms. Most of them are in Asia. They clearly position themselves as wanting to attract 'honeymooners', 'wealthy couples', and 'other people who want to engage in intimate activities'. The hotel experience they create is also centered around these three groups: 'natural luxury', 'eco-friendly', and 'culturally distinctive'."

"I like the word they used instead of 'this is where you conceived your baby.'

Madison's mouth was full of steak, and her words were unclear, but she hit the nail on the head. The Long Island girl originally thought that she could live with Han Yi and enjoy a Michelin-starred chef, or indulge herself in dinner and breakfast. But she didn't expect that Zhao Youzhen would be stricter with her than her mother.

Not to mention eating cereal with milk at dinner time, her daily fitness schedule is clearly arranged and not a minute can be missed.

It is said that this is to prepare her physical strength for the recording of her first album and the tour of the same name, especially the stops in Europe and Asia.

Madison also raised objections - she was going to Europe to perform, not to invade Europe. How much energy could she consume by performing for an hour and a half a night?
She felt that her arguments were strong, but no matter how strong they were, they would not change the outcome. So, she felt sore all over and could only vent her anger on the steak in front of her.

You know what, the flank steak prepared by these two Nordic chefs, paired with their special Dijon sauce, is incredibly delicious.

"Haha, 'This is where you got pregnant', that's pretty accurate. I really hope you can go to the Bund in Shanghai and see the rooms at the Banyan Tree, and who goes there, when, and why."

"You sound like you know a lot about it." Xiaoru narrowed her eyes and switched to Chinese, "You go there often, right?"

"No way." Han Yi wiped the sweat from his forehead, which didn't exist but was pouring down his heart. "I don't live in Shanghai."

"Right?"

"Guys." Madison put down her fork and waved at Han Yi, "What did we say about speaking Chinese in front of me?"

"Keep doing this until one day you understand?" Han Yi thought for a moment and replied seriously.

"You can keep that... teasing smile." Maddie snorted twice and drew a cross on Han Yi's face with her index finger. "One day when you hear me speak fluent Chinese, you will know that you have offended a girl you shouldn't have offended."

“I look forward to that day with all my heart.”

"No, now it won't happen, and I won't give you that satisfaction."

"Oh, I'm so sad. What should I do? We can only live in a miserable world where Madison Beal will never speak Chinese."

"Jokes aside, don't let yourself get too used to speaking in this Chandler tone. It's not good for you. Control it." Xu Yiru patted Han Yi's arm with a smile, leaned her body a little towards the latter, and reminded him softly.

Her little tricks made Madison more breathless than Han Yi's imitation of Chandler's way of speaking. "Okay, back to the point... As a brand, Banyan Tree is too regionalized, and not in a universal way. For example, Mandarin Oriental, whose name, logo, and interior decoration are all very Chinese, why can it open branches next to New York's Central Park or London's Hyde Park, and still be popular? Because it emphasizes the attributes of 'luxury city hotel' and 'international service'. Traditional oriental culture and art are just the shell it uses to package and seek differentiation. Meeting the modern urban life needs of vacationers, business guests, conference and exhibition guests is its core service content."

"What about Banyan Tree? Its entire brand construction is centered around the theme of 'luxury vacation'. It focuses on a vacation experience that is in harmony with nature, claiming to be the 'pioneer of the pool villa concept', 'pioneer of tropical garden spa', 'first to propose the concept of destination dining', 'promoter of the sunset lighting ceremony'... Just listening to these slogans, you can tell that this hotel only focuses on the needs of a niche area, that is, an immersive, pure, secluded resort experience."

"That sounds fine." Han Yi folded his hands on the table and curled his lips. "Aren't these the excellent qualities that a top exclusive hotel brand should have?"

"Of course it is of high quality in the Far East and Southeast Asia." Xu Yiru knew that Han Yi was asking knowingly, but she still answered carefully, "But this does not meet the conditions they proposed. In exchange for 2000 million euros, the transfer of 5% of Banyan Tree Holdings' shares is not a lot of money... Um, at least compared with your other investments, the amount is not exaggerated at all. But what are the additional conditions?"

Using the tip of her index finger to poke a few invisible spots on the marble table, Xiaoru clearly and logically repeated the conditions offered by Banyan Tree Holdings to potential investors.

“You must own no less than three self-owned properties in resorts in the United States and Europe, and promise to lease them to Banyan Tree Hotels to open branches and provide the necessary funds for renovation. The contract period cannot be less than 25 years. What I mean is that you have to spend money to acquire a minority stake in Banyan Tree, without any key decision-making power, and you have to provide them with three high-quality properties, transform the properties to their satisfaction, and hand them over to them for use for at least a quarter of a century... With such harsh conditions, it’s no wonder they have been unable to leave Asia for so many years.”

The girl from Taiwan made herself very angry.

"They really don't want to take any risks in such a high-risk matter and want to pass it all on to investors. You can also see their performance last year. The total revenue from paid service items was US$5809 million, of which hotel revenue accounted for only 36%, or about US$2091 million. Among them, there are only two hotels in America, both in Mexico. One is in Cabo and the other is in Mayakoba. The two hotels together have a total of 162 rooms, with an annual revenue of only US$470 million, and an average revenue of US$79 per room."

"And what about Mandarin Oriental's average revenue per room in the Americas? I just checked their annual report. In Washington DC, which has the worst performance and the cheapest prices in North America, it is $191. In Miami, it is $271. And in New York, it is $694! Even the Kuala Lumpur hotel, which ranked last in Mandarin Oriental's performance worldwide last year, has an average revenue per room of $81, and this was achieved after several months of internal renovation. In 2014, the figure for Kuala Lumpur was $124."

"Wow." Even though he had some idea of ​​the actual situation, after Xu Yiru's detailed analysis, Han Yi was still a little surprised at Banyan Tree's difficulties in Asia. "I knew they didn't perform well in America and Europe, but I didn't expect it to be this bad."

“That’s because the brand’s regional imprint is too obvious,” Xu Yiru concluded decisively. “No one would want to stay at Banyan Tree in Capri or Aspen, just like no one would want to stay at… Passalqua in Bangkok. These resorts have their own natural habitats, and we must respect that and keep them as they are. As you said yourself, Yi, you are not the savior of every industry and every company. You are not obligated to build Banyan Tree into a global brand, especially under the premise that they have proposed this kind of cooperation conditions.”

"Don't worry, I won't agree to their terms." Han Yi gave Xu Yiru a comforting smile, "But I won't reject them bluntly either... I will let Antoine negotiate with them slowly and carefully until they find a more suitable partner, and then 'regrettably' terminate the negotiations. After all, you also said that they have a natural competitive advantage in Southeast Asia. Maybe one day, we will also cooperate with Banyan Tree in those regions."

"Of course we shouldn't reject it bluntly." Xu Yiru agreed, "After all, this is also a collaboration arranged by the Carlyle Group, right?"

"Correct."

"So, even for Carlyle's sake, we have to maintain a good relationship with Banyan Tree and keep the superficial negotiations going as long as possible. Prove to Carlyle that we will take every investment opportunity seriously, and then they will continue to send us such proposals."

“What about other hospitality investment opportunities that Carlyle has given us, such as this one.”

After finishing the last piece of steak on the plate, Han Yi wiped the corner of his mouth with a napkin, then stood up and picked up the brochure that he had casually placed on the back of the sofa.

"Rixos Hotel Group, in order to obtain funds to help them further develop, decided to sell 50% of its shares."

“They are one of the fastest growing all-inclusive resort companies in EMEA, with a strong presence in Turkey, the UAE, Egypt, Russia and the rest of Europe. They currently own 23 resorts and hotels with over 8500 rooms.”

“Average daily rate of $270, average occupancy for the year of 70%, staff-to-room ratio of 1.2:1, average revenue per available room of $189, and gross margin of 46%.”

"Do you think such a hotel group has investment potential?"

(End of this chapter)