Development

Oakwood targets at the China market for expansion

By Chen Qide (China Daily Shanghai Bureau)
Updated: 2011-01-24 15:09

SHANGHAI -- Oakwood, a worldwide leader in temporary housing, is targeting at the China market for expansion, which has been considered part of its global strategy.

"We are working out a strategic plan for China which has been considered as one of our key markets in Asia," said Bensy Teo, general manager of Oakwood Residence Shanghai.

Oakwood has 22 operating properties in Asia, in locations such as China, India, the Philippines and Thailand, with 24 scheduled to open by 2013 with its greatest growth in China and India.

With the addition of Oakwood Residence Shanghai, Oakwood has now managed over 1,000 units of serviced apartments in China along with its properties in Beijing, Guangzhou of Guangdong province, Hangzhou of Zhejiang province.

"As more businesses coming from abroad to echo the robust growth of the Chinese economy, they need serviced apartments for employees," Teo said.

He said China is really hungry for serviced apartments with so many business people coming to work in Shanghai and other parts of China although some other serviced apartment brands have done their business.

"It provides great potential for us to expand serviced apartment business," he said.

Oakwood provided its first residence property for clients in Shanghai on April 2010 before the opening of the World Expo, but "it is far from enough," he said. "We plan to open a premium property in the metropolis within two years to meet the growing demand."

The residence property in Putuo district with 112 fully-equipped apartments profited from the World Expo which closed on October 31, 2010, laying a solid foundation for this year's business, said Li Yan, sales director of Oakwood Residence Shanghai.

"Our monthly gross operating profit (GOP) accounted for about 50 per cent of sales in 2010, an inconceivable result to a newly-opened serviced residence," said Li.

"With a good beginning last year, we expect an increase of about 15 per cent in GOP this year," he said. Its clients come mostly from Japan, Europe and America at present. Efforts will be made this year to win over more customers from Southeast Asia when stabilizing the European and American markets, he said.

To reach its expansion objective for the China market, Teo said Oakwood will open its first property in Chengdu of Sichuan province by mid 2011 and a second property in Guangzhou in late 2011.

"The expansion also includes effort to set up premium properties in Beijing, Nanjing of Jiangsu province and Xi'an of Shaanxi province by co-operating with local partners," he said.