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Choice Hotels on Expansion Mode, To Open 30 Hotels in Japan

Zacks Equity Research

Choice Hotels International, Inc. CHH is making every effort to expand global footprint. With regard to this, the company has extended its current master franchising agreement with Choice Hotels Japan by 10 years. Choice Hotels plans to open more than 30 Comfort hotels in Japan by 2033. The company has more than 60 hotels in Japan.

The company is planning to open first seven Comfort hotels in the next three years in cities like Kyoto, Matsuyama and Nagoya. These efforts will help the company to increase Comfort brand rooms to more than 15,000 by 2025.

Choice Hotels President and Chief Executive Officer, Patrick Pacious said, “International growth is a major focus for us and Japan is one of the world's fastest-growing travel destinations, so we're thrilled to increase our presence in this highly sought-after global market.”

Notably, the company is banking on the strategy of opening more than one hotel per week in the current year. In comparison with Jun 30, 2018, the company’s portfolio of rooms and hotels located outside the United States in the first-half of 2019 has increased by 4.1% and 5.4%, respectively.

Comfort Brand Major Growth Driver

Notably, the Comfort brand has been doing solid business. Moreover, Comfort’s pipeline has more than 300 properties, out of which 80% are newly constructed. Comfort hotels also anticipates to open 25 more properties this year in major markets such as Dallas, Nashville, Tennessee, Pittsburgh, San Antonio and San Diego. These efforts will help it attract business travelers, improve overall guest experience and increase RevPAR for years to come.

Backed by solid expansion strategies and strong brand presence, shares of Choice Hotels have gained 22.4% so far this year compared with the industry’s rally of 15.4%.


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