DoubleDragon plans franchising of JinJiang
Property developer DoubleDragon Properties Corp. plans to expand its hotel portfolio under the hospitality brand Jinjiang Inn via franchising.
“For JinJiang, we plan to build five company-owned hotels and subfranchise,” DoubleDragon chair Edgar Sia II said in a recent interview. JinJiang Inn, one of the leading hotel chains in China, is one of the brands under DoubleDragon’s hospitality arm, Hotel of Asia Inc. (HOA).
“It’s like McDonald’s. We only own a few then we sub-franchise the rest,” he said.
HOA is the exclusive master franchisee of JinJiang Inn in the Philippines. The brand has catered to a growing number of tourists from mainland China following President Duterte’s rekindled diplomatic ties with China last year.
With this franchising model, Sia said hotel expansion would become a low-capital expenditure business.
DoubleDragon recently increased its 2020 leasable portfolio target from one million square meters (sqms) to 1.2 million sqms covering a slew of projects from malls to office spaces.
The property developer is set to raise $150 million from a follow-on equity offering, the last major capital market exercise needed to fuel a fast-tracked expansion program through 2020.
DoubleDragon is set to conduct a series of overseas road shows in Singapore, Hong Kong and Kuala Lumpur for the offering, according to Sia.
DoubleDragon seeks to offer up to 150 million in common shares at an offer price of up to P50 each. The base offer will consist of 135 million new common shares plus an overallotment option to sell up to 15 million additional shares in case of strong demand.
Three years after selling shares mostly to local retail investors, this exercise is seen to allow foreign international investors to take part in DoubleDragon’s growth phase. Apart from supplementing funds for its expansion program, the exercise is also seen to widen DoubleDragon’s trading liquidity in line with its aspiration to be part of the Philippine Stock Exchange index (PSEi) in the coming years.
