We operate hotels in three ways: as a franchisor, a manager and an owner. Our business model focuses on franchising and managing hotels on behalf of our owners around the world.
We have 3,585 hotels operating under franchise agreements, 585 hotels we manage on behalf of owners and 16 hotels we own ourselves.
| BRAND | MARKETING AND DISTRIBUTION | STAFF | OWNERSHIP | IHG CAPITAL | IHG REVENUE | |
|---|---|---|---|---|---|---|
| OWNED AND LEASED | IHG | IHG | IHG | IHG | high | all revenue |
| MANAGED | IHG | IHG | IHG usually supplies general manager as a minimum | third party | low/none | fee % of total revenue plus % of profit |
| FRANCHISED | IHG | IHG | third party | third party | none | fee % of rooms revenue |
Franchising
We have 3,585 hotels operating under franchise agreements, which represents nearly 86 per cent of the estate. Franchising enables owners to trade under one of our brands, leverage our scale and take advantage of our reservations systems such as our call centres, sales teams, websites and Priority Club Rewards. Owners also have our support in, and access to, property improvement plans, quality training and marketing support.
Managing
We have 585 hotels operating under management contracts, representing almost 14 per cent of the estate. Under a managed contract we run the hotels on a day-to-day basis with direct control over quality and service standards, but ownership of the buildings remains with a third-party owner.
Owning
Today we own just 16 hotels of the 4,186 operating under one of our brands – less than 1 per cent of the estate. These hotels have a net book value of approximately $1.7 billion, the majority of which is represented by our InterContinental hotels in London, Hong Kong, New York and Paris. Since 2003 we’ve sold 183 hotels and have retained our brands on 90 per cent of these, giving us a continuing income stream.
