IHG has new U.S. midscale brand in the works

By Danny King
InterContinental Hotels Group (IHG) will debut an upper-upscale brand for China and a midscale brand for the U.S. by mid-2012.

The China brand, which IHG previously announced but hadn’t set a debut date, will “fill a gap for an international five-star quality hotel tailored for the Chinese customer,” IHG CEO Richard Solomons said on a conference call with analysts on Tuesday.

Solomons added that IHG plans to spend $150 million over the next three years launching the U.S. brand, which he said will result in “minimal cannibalization” of sales of existing midscale brands Holiday Inn and Holiday Inn Express.

Solomons, who didn’t disclose the names of the two brands, also said that IHG’s efforts to move the Crowne Plaza badge into the upper-upscale sector resulted in 11 of the approximately 400 Crowne Plaza hotels leaving the chain last year.

IHG estimates that another 30 properties will depart Crowne Plaza over the next two years, while hotel owners who stay with Crowne Plaza upgrade properties to comply with IHG’s strategy.

For hotel and hospitality news, follow Danny King on Twitter @dktravelweekly.
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