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after being shut down for more than four months, blueray jizhuang (hereinafter referred to as jizhuang), which was once regarded as the "ceiling of parent-child hotels in the southwest region", reopened not long ago and transformed itself into emeishan wulan resort hotel (hereinafter referred to as emeishan wulan).

jizhuang, which is located in a popular scenic area with abundant passenger flow and room rates as high as 28,800 yuan per night, attracted widespread attention after the news of its sudden closure in early april this year.

schematic diagram of jizhuang room image source: alibaba auction

at that time, the reporter found that the "crisis" of jizhuang had already broken out before it closed down: at the end of 2023, jizhuang was put on the judicial auction platform with an assessed price of 394 million yuan. after two auctions, the starting price differed by 55 million yuan, but both failed in the end. in mid-march this year, jizhuang was officially closed and hundreds of employees were terminated. however, in the eyes of cultural and tourism experts, jizhuang is an excellent asset in the domestic hotel industry. the future of this five-star luxury parent-child hotel has always attracted much attention from the market.

recently, jizhuang changed its name and opened for business, and its new boss, the "ulan group", also surfaced. according to the daily economic news reporter, this is a large coal enterprise from inner mongolia - ordos city ulan coal (group) co., ltd., which is affiliated to ordos city ulan development group co., ltd. (ulan group for short). ulan group is a local private enterprise integrating coal industry, agriculture, animal husbandry, accommodation, wine making and other businesses.

an insider revealed to reporters that wulan group paid 220 million yuan to buy jizhuang. as the dividends of "revenge consumption" this year are cleared, the hotel industry is facing challenges. international hotel giants including hilton and intercontinental have all seen weak growth in the chinese market. why would wulan group, the "grassland gold owner", spend so much money to purchase hotel assets at this time?

220 million yuan for "finding a bargain" and then spent more than 30 million yuan on renovation

emeishan wulan, which reopened one month ago, currently has a good reputation on multiple hotel booking platforms, with scores of 4.8 and 4.9 on ctrip and qunar respectively; and the room prices are basically the same as those in the jizhuang period.

"the ulan group has renovated all the hotel's facilities, including the exterior facade, interior of the guest rooms, office buildings, and employee dormitories." an insider of emeishan ulan said in an interview with the "daily economic news" reporter that the ulan group attached great importance to the first high-end resort hotel it acquired. in april this year, after the asset handover was completed, it immediately sent a team from the headquarters to renovate the hotel facilities, with a total estimated cost of more than 30 million yuan.

the above-mentioned insider was responsible for part of the management of jizhuang. he revealed to reporters: "in fact, the operation of this hotel has always been good. it is the leading luxury parent-child hotel in china. during the special period of 2021, our annual turnover was more than 60 million yuan, so (the closure) was only affected by the (debt explosion) of blueray real estate."

the reporter learned that the hotel has only 198 rooms. if roughly calculated based on an annual turnover of 60 million yuan, the average annual revenue per room exceeds 300,000 yuan, and the average monthly revenue exceeds 25,000 yuan per room.

zhuang zebao, a senior person in the real estate industry, analyzed in an interview with the reporter of "daily economic news" that although the square meters of high-end hotel rooms are large, there are not many that exceed 100 square meters. in the residential industry, it is rare for a 100-square-meter house to have a monthly rent of more than 25,000 yuan, and the hotel is not fully booked every day. therefore, zhuang zebao believes that jizhuang has strong profitability before.

on april 10 this year, when a reporter from the daily economic news called the jizhuang public telephone as a consumer, the staff who answered the call (responsible for handling subsequent matters) said that the hotel had not been open since march and all employees had been laid off.

fortunately, more than 70% of the employees who were "laid off" at the time have now been rehired by the wulan group. "when we disbanded, we had about 230 employees, and now about 180 have returned." the insider of emeishan wulan told reporters that within the year after the rebranding, emeishan wulan hopes to cater to the market and regain its popularity with relatively affordable prices.

the hotel staff said that there is only one presidential villa in the entire hotel. image source: emeishan wulan booking website

when ji zhuang closed down, a former real estate industry executive told the reporter of "daily economic news" that the hotel had a superior geographical location, "good brand and operating conditions, and was a high-quality asset. the higher-end the hotel, the stronger its ability to resist risks, so this kind of high-quality asset will have a buyer."

after jizhuang was changed to ulan group, the market was particularly concerned about how much money this "grassland gold owner" spent on the acquisition? the reporter learned from multiple interviews that on november 23, 2023, jizhuang was put on "taobao.com" by the shanghai financial court for public auction, with an estimated price of 394 million yuan, but it was auctioned twice, with a starting price difference of up to 55 million yuan, and both failed in the end. "it is true that all the online auctions were unsold, but they (ulan group) sold it offline at the unsold price of the second auction, which is 220 million yuan." a person familiar with the auction told the reporter of "daily economic news".

at that time, jizhuang had two online auctions that failed. image source: alibaba auction

however, compared with the appraisal price, wulan group bought jizhuang at a 56% discount. "from the purchase price drop, (wulan group) took over at the right time, which is a good deal." zhuang zebao pointed out to reporters.

why did the “grassland buyer” appear and spend a lot of money to buy a luxury hotel in the southwest?

"the capital investment and operational determination required by the buyer must be huge." the aforementioned former real estate industry executive once pointed out to reporters that after ji zhuang changed hands, it first faced difficulties in revitalization and other aspects.

what is the background of ordos wulan coal (group) co., ltd., which has taken over jizhuang across the border? the reporter learned that the company is affiliated to wulan group. wulan group is a local private enterprise based on coal production, sales, washing and clean utilization, integrating cogeneration, catering, accommodation, brewing, dairy, building materials, photovoltaic power generation, and modern agriculture and animal husbandry. it has more than 40 subsidiaries and more than 10,000 employees.

tianyancha shows that ulan group is held by 39 natural person shareholders, among which li yuliang, chairman of the board of directors of ulan group, holds the largest shareholding ratio of 5.3876%. li yuliang's subscribed capital and paid-in capital are both approximately 10.87 million yuan.

according to media reports, li yuliang once reported on the situation of ulan group as a member of the inner mongolia delegation during the 2019 national people's congress. at that time, li yuliang said: "i am the head of a private enterprise that grew up with reform and opening up. over the past 40 years, i have been a farmer and joined the army. after retiring from the army, i started as a coal miner and grew into today's chairman."

in the honor column of ulan group’s official website, the company was named one of the “top 100 private enterprises in inner mongolia” in september 2023 and ranked 21st; the company is also one of the top ten tax contribution companies in ordos city in 2022.

due to the reputation of jizhuang in the parent-child circle before it closed, many bloggers visited the wulan hotel in mount emei after it changed its name and reopened to find out what changes had taken place. "try the umbrellas of the wulan hotel and you will know that the new hotel owner is not short of money and is willing to spend money on details," commented a blogger.

why did the ulan group, which is far away in inner mongolia and whose main business is coal, acquire hotels in the southwest?

the reporter learned that the wulan group, which has spent a total of 250 million yuan on the layout of five-star hotels, already has five hotels, three of which are located in inner mongolia and two in hainan. the wulan group also intends to integrate its resources through this hotel in mount emei, and inject beef, mutton, dairy and other products.

ulan group's hotels in hainan. image source: ulan group's official website

"for example, in breakfast, we have incorporated inner mongolia milk tea. beef, lamb chops, ulan pure milk, etc. are all produced by our ulan group ranch and airlifted from inner mongolia." the above-mentioned emeishan ulan insider told reporters that the brand hopes to use the hotel to convey inner mongolia's culture and food to tourists in sichuan and even all over the country.

zhuang zebao told the reporter of "daily economic news" that after taking over emeishan wulan, the ulan group also grafted and revitalized the group's original resources. "on the one hand, it can use the high-quality customer base living here to better market the group's dairy products. on the other hand, if the hotel here is managed well, the ulan group can also replicate the high-end hotel experience it has gained to other cities."

zhuang zebao believes that the main business of the ulan group can support a good cash flow. although it had hotel business before, it was limited by the city and it was difficult to make a breakthrough in level. the acquisition of jizhuang not only completed the leap in the level of the group's hotel industry and improved the level of the team, but also the growth of the hotel business sector is expected to become a "new blood-making" for the ulan group.

regarding ulan group's other ideas for hotel industry layout, a reporter from daily economic news called the company, and a person related to the company said that ulan group would not accept interviews for the time being.

“hiltons” also lack tenants. how does the ulan group win?

this year, the domestic hotel industry is facing challenges, and the hotel performance of many international giants in china has also shown sluggish growth. in august, international high-end hotels such as intercontinental hotels group (hereinafter referred to as intercontinental), marriott international group (hereinafter referred to as marriott), and hilton hotels group (hereinafter referred to as hilton) successively released their performance for the first half of 2024.

revenue per available room (revpar) is a key indicator for measuring the hotel industry. according to the financial report, in the first half of 2024, intercontinental hotels' global revpar increased by 3%, but decreased by 2.6% in greater china; marriott international's revpar increased by 4.5% year-on-year, and the revpar in the asia-pacific region excluding china increased by more than 14% year-on-year; hilton hotels group's revpar increased by 2.8% year-on-year. in the second quarter, hilton's revpar in the asia-pacific market excluding china increased strongly by 11%, while the revpar in the chinese market fell by 5% year-on-year.

the reporter noticed that marriott, hyatt, wyndham, and intercontinental all recorded year-on-year declines in revpar in their hotels in china in the second quarter. among them, wyndham's revpar in china decreased by 17% year-on-year; marriott, hyatt, and intercontinental's revpar in china decreased by 4.6%, 3.2%, and 7% year-on-year, respectively. in terms of average daily room rates, the adr (rise/fall ratio) of marriott, hyatt, and intercontinental hotels in china decreased by 5.9%, 4.8%, and 0.2% year-on-year, respectively.

on the one hand, major international hotel groups seem to be experiencing a year-on-year decline in revpar in the chinese market. on the other hand, the supply in the domestic hotel market is increasing significantly.

according to data from the china hotel association, the net increase in the total number of hotels and rooms in china in 2023 will be 44,000 and 2.23 million respectively, which is the fastest growth year for hotels since 2016. according to data from maidian research institute, the opening of luxury hotels in june this year increased by 500% month-on-month, and the signing of contracts increased by 200% month-on-month. in the next few years, the top hotels will continue to be supported in the core cities of china.

the reporter learned from emeishan ulan that in the future, ulan group will also deploy hotels across the country.

zhuang zebao told the daily economic news reporter that under this circumstance, the ulan group, which crosses borders to acquire high-end hotels, faces both opportunities and challenges. "the overall market consumption is weak, and high-end hotels are also under pressure. the key is how to provide services and characteristics."

"for them (ulan group), the first step is to manage the acquired assets well; the second step is to continue to increase the hotel prices through value-added. in the process, they can either increase the (price) of the existing hotel, or use the experience of operating the emeishan ulan hotel through the next site selection or acquisition. but be careful not to blindly raise the prices of each hotel. at the same time, think about how to impress the markets in different places through some distinctive services. this is also a test for the ulan group." zhuang zebao told reporters that if the ulan group can further expand its hotel business in the future, it will also open up a new ceiling for the group's growth potential.