HVS Monday Musings: The Dichotomy between Management Fee and Franchising Fee in India

By Akash Datta and Dipti Mohan
Franchising provides an efficient growth model with lower risk for both hotel brands as well as asset owners, but it has still not gained significant traction in India. Read on to know more.

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Singapore Eases Local Tour Restrictions from 1 November

Singapore has announced that from 1 November 2020, local tours can double their participant size per group from the current 10 to 20 participants, excluding tour guide, for outdoor tours. Tour participants of the same sub-group can interact with one another, but not with tour participants from different sub-groups who must always maintain a safe distance of one metre. Travel agents, tour operators and tourist guides must still submit their tour itineraries and schedules to Singapore Tourism Board (“STB”) for assessment. They may only organise the proposed tours after receiving approval from the Ministry of Trade and Industry. Meanwhile, the STB and Expedia established a partnership to stimulate the local tourism industry by supporting home-grown businesses and strengthening Singapore’s position as a destination of choice when international travel resumes. From now until April 2021, STB and Expedia will offer residents domestic holiday bundles, attractive staycations, attractions, and tours, that cater to a variety of interests and budgets. As international travel gradually resumes, STB and the Expedia Group Media Solutions brand will jointly promote in ten overseas markets including Japan, South Korea, Hong Kong, United Arab Emirates, Germany, France, Switzerland, Canada, United Kingdom and the United States.

Indonesia Government to Disburse IDR3.3 Trillion Grant to Tourism Industry

Minister of Tourism and Creative Economy, Wishnutama Kusubandio, has announced a disbursement of IDR3.3 trillion (USD224 million) grant to aid tourism-related businesses, particularly hotels and restaurants, to cope with the impact of the pandemic, and to finance improved health protocol implementation at tourist destinations. The grant is expected to be disbursed until December as part of the government’s IDR695.2 trillion Covid-19 national economy recovery fund which is set up to finance the healthcare system and bolster the economy. The grant would be available in regions where revenue from hotel and restaurant tax accounted for at least 15 percent of its locally generated income in the 2019 financial year. Some of these regions are Mandalika, West Nusa Tenggara and Borobudur, Central Java, and other branding destinations and regions included on the Ministry’s calendar of events. The bulk of the grant, 70 percent of it will be distributed to hotels and restaurants, while the rest will be set aside for regional cash injection. Alongside the grant, the Tourism Ministry plans to set aside IDR119 billion to provide free cleanliness, health, safety and environmental sustainability certification to local businesses in order to help regain tourists’ trust in travel.

Ratanakorn Asset Appointed ONYX Hospitality Group for Three Developments in Pattaya

Thailand-based ONYX Hospitality Group is entering a partnership with Ratanakorn Asset, a Thai real estate company, for three new developments in Pattaya, including the first YOO Beach Club, the Asia-Pacific region's first Yoo2 Hotel, and Southeast Asia's Shama Hub. The YOO Beach club will be located adjacent to the 400-key Amari Jomtien Pattaya which is currently under construction. They will form part of a mixed-use beachfront development located in Na Jomtien Beach. Slated to open in 2024, it will incorporate a community retail mall and events space. Located in Wongamat Beach, the 100-key upscale lifestyle hotel, Yoo2 and 250-key studio-living concept, Shama Hub, will be constructed as a dual-branded hotel tower. Both properties will entail district product offerings and experiences.

Singapore and Germany to Set Up Reciprocal Green Lane for Business and Official Travel

On 23 October 2020, Singapore's Foreign Affairs Ministry and the German Federal Foreign Office have agreed to establish a reciprocal green lane for essential business and official travel via direct flights between the two countries. Details of the green lane, including the procedural requirements, health protocols and application process, will be announced at a later date. Germany has also announced that Singapore residents can enter Germany again for short-term stays, without having to undergo quarantine on arrival starting from 27 October. The move follows the European Council's recommendation this week that member countries of the European Union may gradually lift entry restrictions on Singapore residents. However, Singapore has no green lane arrangements with countries in Europe presently. Singapore currently has in place travel arrangements with ten other countries and territories, with varied restrictions.

Absolute Share Price Performance, as on 30 October 2020