To further strengthen its presence in the short-stay service residence market, Frasers Hospitality will add 11 properties under the recently launched Modena brand in the next few years, six of which will open by 2012.
This growth is expected to continue, with the brand likely to see the number of apartments increase by 20 percent year-on-year over the next few years, surpassing that of its Fraser brand, said Choe Peng Sum, chief executive of Frasers Hospitality, in an interview with The Business Times.
Frasers Hospitality opened the first property under the Modena brand in March 2010 in Tianjin, which comprises 104 residences. The second Modena property with 348 apartments was opened yesterday in Shanghai.
The company has established over 30 properties under the Fraser brand, which usually serves travellers who opt for a six-month stay or even longer.
Under the Modena brand, it will cater to travellers who opt for a short stay.
Mr. Choe said China will play an important role in the growth of the brand.
At least four Modena properties will open in China in 2012, with one scheduled to open later this year in Suzhou.
The brand is also planning to build a presence in second-tier cities like Dalian, Chengdu, Hangzhou and Nanjing, where it is expected to see “tremendous growth”, said Mr. Choe.
“China’s exceptional growth has spurred both domestic and international travel. Many business travellers, or as we call them, road-warriors, on frequent short business trips or project-based work are looking for accommodation that complement their hectic and energetic lifestyle,” he said.
“It is with this growing segment of young, mobile, and independent professionals in mind that Fraser created and customised our second brand, Modena.”
He also believes that the business will not be greatly affected by the appreciating yuan.
“It is definitely going to get more expensive to live in China, but labour costs here are still cheaper, so international firms will still gravitate toward China,“ said Mr. Choe, adding that local firms are seeing fast expansion, which will improve inter-state travel.