Chinese real estate developer Franshion Properties is seeking to raise up to HK$3.39bn ($437m) from a proposed listing of its hotels arm on the Hong Kong stock exchange.
The funds will be used to expand its business in China and refinance debts.
In March, Jinmao Investments Group announced plans to spin off its China commercial and retail complex, Jin Mao Tower hotel, and eight hotels in the mainland through an investment trust to be listed on the main board in Hong Kong.
Franshion unit China Jin Mao Group vice president Andy Ding told Reuters that the firm will work with online platforms to promote holiday packages, and will also look at opportunities overseas targeting Chinese tourists.
"Budget hotels have had explosive growth in the past and become saturated. As China’s gross domestic product grows, people’s request for quality has increased, so now the mid-tier, which is the three- to four-star (hotels), has large room to grow and great potential," Ding added.
Franshion Properties is a developer and operator of large-scale and high-end commercial real estate projects in China, and also a platform enterprise under the real estate and hotel segments of Sinochem Group.
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The hotels within its portfolio are working with online travel agents such as eLong and Ctrip.com International, in a bid to attract domestic travellers.
According to market consultant DTZ, revenue attributed to domestic and foreign inbound tourism grew 24% and 3.5%, respectively, between 2007 and 2012.