One of ZEN rooms in La Paz, Manila. Nathan Boublil, co-founder & CEO of ZEN (inset). NSTP

ZEN Rooms – a leading economy and mid-range hotel franchise in Southeast Asia – signed an agreement recently with Yanolja (Korea) on additional investments, the acquisition of early investors’ stakes, and for a wide strategic alliance.

Yanolja is the leading travel group in South Korea, which is backed by Booking Holdings and GIC, among others.

The alliance of ZEN and Yanolja creates the leading economy and mid-range hospitality group in Southeast Asia.

It combines ZEN’s top-rated budget hotel franchise business with Yanolja’s scale, hospitality technologies and the backing by the global leader in online travel, Booking Holdings (behind such names as Booking.com, Agoda, Priceline.com, Kayak and more).

This gives ZEN unique competitive advantages in both hotel technology and sales distribution.

The group will work to heavily deploy automation technology to enhance customer experience; further reduce budget hotels’ operating costs; and reinvent budget hospitality across Southeast Asia.

ZEN Rooms is today one of the largest hotel franchises in Southeast Asia, with 13,000 rooms under franchise.

Southeast Asia is the world’s fastest growing travel market, fuelled by exponential domestic and regional demand of young travellers and millennials.

Yet, the value-for-money proposition of its budget hotel sector has historically been defective, plagued by several issues: fragmentation, poor hygiene and safety standards, lack of training, and low technology use.

ZEN was founded in 2015 to improve the state of budget hospitality and bring much needed operational and technological efficiency to the estimated two million independent economy rooms in the region.

Thousands of hotel owners have since joined ZEN’s franchises to improve their revenue, optimize their cost base, and increase the long-term value of their property. These efficiency gains ultimately benefit travellers who can enjoy safer and better value-for-money stays.

“We started ZEN exactly four years ago to make budget accommodation in Southeast Asia more affordable and safer. We have proudly built ZEN into the top-rated budget hotel franchise in the region and were honoured to be Yanolja’s 1st international investment.

“With this strategic alliance, we are joining forces with one of the most technologically innovative travel groups and its unique backers Booking Holdings to create the first full service budget and mid-range hospitality group in SEA, able to deploy world-class technology infrastructure in IoT R&D, automation, hardware and software to all hotels in Southeast Asia.

“This alliance will greatly benefit our ability to serve our hotel clients and ultimately the travellers of the entire region”, said Nathan Boublil, co-founder and CEO of ZEN.

Jongyoon Kim, CEO of Online Business at Yanolja, meanwhile said: “Since first investing in ZEN, we have shared the same vision of operational excellence and customer centricity to radically improve the Southeast Asian hospitality market. In the last 12 months, the ZEN team has taken major steps to fulfil this vision and has grown exponentially while displaying top inventory quality.

“With this exciting agreement, Yanolja plans to fully support ZEN to solidify its status as the market leading full-stack hospitality company in the region," he added.