Learning From China in Russia...

There has been a fundamental shift in the past decade in the way hotel companies operate. They have moved to an asset light model, focusing on branding and operations while selling off real estate. This model which separates operating companies from brand owners has been pioneered successfully for sometime by Interstate in Russia.

Interstate China has assumed management of its first properties in China in January and has embarked on an aggressive expansion plan using this model across the country, from Shanghai and Wuhan to Beijing. Chris van der Baars, Chief Operating Officer, Interstate China Hotels and Resorts commented “the third-party management model is popular with our owners as we focus on the their interests and we show flexibility in terms and conditions.”

China is already the world's second biggest economy and is poised to overtake the US in the number one slot during the early part of this century. This economic growth has created a huge new middle class that is going to shape the travel trends for the next generation.

Interstate was also selected recently to manage six hotels in Sochi, Russia, currently under development by NBB-Development, Moscow. The properties, which will aggregate 1,564 rooms are expected to open in the Autumn of 2013 in time for the 2014 Winter Olympics. Ken McLaren, executive vice president of international operations, said. "Russia has become the fifth biggest outbound market in the world. Russians, instead of spending money in Russia, tend to travel abroad. Part of the reason for Sochi is to attract Russians back to Russia."

Andrew Sangster Editor and publisher of Hotel Analyst will join Chris van der Baars Chief Operating Officer, Interstate (China) Hotels & Resorts on a panel entitled The Emerging Powerhouse of China at the Russia & CIS Hotel Investment Conference (RHIC), Moscow in October. They will look in detail at what lessons can be learned from Interstate’s latest strategy in emerging markets. How the Russian hotel industry can benefit from growth experienced in China, and what opportunities are there for Russian based businesses to enter the Chinese market.

Jonathan Worsley co-organiser of the RHIC conference said ‘we will also be taking a close look at finance within the industry at the moment with sessions entitled Bankers in the Hot Seat exploring what the lending criteria is and where they foresee opportunities arising; finding out how investment structures have shifted during the global financial crisis with the panel Catering to today’s new owners and investors; and looking at what finance is available and where with the session Structuring hotel projects and sourcing financing in Russia.

For full programme details visit