Table of Contents
Introduction
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- Key findings
- Definitions and abbreviations
- Hotel companies
Data Sources
Overview
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- Inflation is back
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- Figure 1: Forecasted GDP growth and other economic data by region and major country, June 2011*
- Outlook for spending on travel and tourism
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- Figure 2: Travel and tourism expenditure worldwide, 2011-21
- On the rebound
- Downturn in business travel hit hotel sector hard
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- Figure 3: Real growth in worldwide travel and tourism expenditure (y-o-y % change), 2008-15
Hotel Performance by Geography
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- US Dollar figures flatter performance
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- Figure 4: Hotel market performance by world region, YTD June 2010 & June 2011
- A mixed bag across the Americas
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- Figure 5: Hotel market performance by country in the Americas, YTD June 2010 & June 2011
- Santiago and São Paulo lead the way
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- Figure 6: Hotel market performance by major city in the Americas, YTD June 2010 & June 2011
- Strong rebound in Eastern Europe
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- Figure 7: Hotel market performance by European country, YTD June 2010 & June 2011
- Venice number one
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- Figure 8: Hotel market performance by major European city, YTD June 2010 & June 2011
- Performance boosted by strong currencies in Asia Pacific
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- Figure 9: Hotel market performance by Asia-Pacific country, YTD June 2010 & June 2011
- Strong rebound in Bangkok
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- Figure 10: Hotel market performance by major Asia-Pacific city, YTD June 2010 & June 2011
- Arab Spring taking its toll on Middle East
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- Figure 11: Hotel market performance Middle Eastern/African country, YTD June 2010 & June 2011
- A difficult period for Middle Eastern cities
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- Figure 12: Hotel market performance major Middle Eastern/African city, YTD June 2010 & June 2011
The Ten Biggest Chains Worldwide
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- Figure 13: The ten biggest branded hotel chain management and franchise companies worldwide, 1 January 2010 & 2011
- InterContinental Hotels Group
- A concentrated brand portfolio
- Holiday Inn relaunch completed
- 1,200 hotels left the chain
- A new exterior look
- Guestroom upgrades
- Customer service training
- Publicising the relaunch
- A big splash in 2010
- Enhanced performance
- Pilot hotel in Pittsburgh has seen benefits
- Social hubs in Holiday Inns
- Portfolio still heavily weighted towards the US
- Asia Pacific more upscale
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- Figure 14: IHG’s portfolio by brand and region, 31 March 2011
- Pipeline steady at 30% of existing capacity
- Growth is picking up in EMEA
- Holiday Inn Express to the forefront
- No InterContinentals
- Further expansion in China planned
- One in four new hotels to be in China
- Expansion into second- and third-tier cities
- IHG continues to invest in training and education in China
- 25 IHG academies
- Three more to come
- A new Chinese brand under development
- A deal in India
- A 24% stake
- Leveraging a small investment
- Duet Group a mid-market player
- Hilton Worldwide
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- Figure 15: Hilton’s brand portfolio, March 2011
- Geographical spread
- Rapid growth planned for Home2 Suites
- Still highly concentrated in US
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- Figure 16: Hilton’s worldwide portfolio and pipeline by major country/region, 30 June 2011
- Figure 17: Hilton Worldwide’s geographical spread by major country, March 2011
- Expansion outside the US
- A substantial European pipeline
- Fast-forward in China
- Saudi Arabia targeted
- hiltonrestaurantconcepts.com
- Two options for property owners
- Hilton’s McLean property showcases new design features
- On the lobby bandwagon
- A revamped registration desk
- Technology lounge
- New showers
- Design plan offers options
- Hilton launches Huanying
- Chinese media service also introduced
- A boost for Blackstone
- Wyndham Hotel Group
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- Figure 18: Wyndham’s hotel portfolio by major country/region, 31 December 2010
- Hotel brands
- Wyndham Hotels and Resorts
- Wingate by Wyndham
- Ramada Worldwide
- Baymont Franchise Systems
- Days Inns Worldwide
- Super 8 Worldwide
- Microtel Inns & Suites
- Howard Johnson International
- Hawthorn Suites
- Travelodge Hotels
- Knights Franchise Systems
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- Figure 19: Wyndham Worldwide’s hotel portfolio, 31 December 2010
- Wyndham acquires TRYP
- 13,000 rooms in key urban markets
- A Tryp by Wyndham in NYC
- A deal with Planet Hollywood
- Originally a restaurant concept
- Wyndham launches Planet Hollywood hotel development
- Planet Hollywood Hotel Entertainment City
- Planet Hollywood Hotel Panama City
- Planet Hollywood Hotel Boao
- Wyndham enters the boutique segment
- Chatwal Hotels & Resorts
- Marriott International
- The first to ‘split bricks and brains’
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- Figure 20: Marriott’s hotel portfolio by asset management structure, 21 December 2010
- Management contracts
- Performance clauses
- Management functions
- Franchise contracts
- Marriott brands
- Still heavily concentrated in the US
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- Figure 21: Marriott’s hotel portfolio by brand, operating structure and location, 31 December 2010
- Foray into boutique segment off to rocky start
- 100 hotels was original plan
- Schrager design and Marriott know-how
- Schrager on a new tack
- Waikiki owner takes Marriott to court
- Autograph Collection for independent hotels
- Cheaper way into Marriott network
- Growth has not met expectations
- Strategy for Europe
- JV with AC Hotels
- Expansion in India
- Marriott to spin off timeshare
- US$1.5 billion in unsold assets
- Timeshare revenues have stagnated
- New company to be franchisee
- Other hotel groups to follow Marriott’s lead?
- Accor
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- Figure 22: Accor’s hotel portfolio by brand and region, 31 December 2010
- Figure 23: Accor’s hotel portfolio by brand and region, 31 December 2010 (continued)
- Hotel brands
- Two-tiered branding strategy
- Luxury and upscale
- Midscale
- Economy
- Budget
- Differentiated asset management structures
- Mature market strategy
- Emerging market strategy
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- Figure 24: Accor’s hotel portfolio by brand and asset management structure, 31 December 2010
- Figure 25: Accor’s hotel portfolio by brand and asset management structure, 31 December 2010 (continued)
- 36% of rooms still owned or under fixed lease
- An ‘asset-right’ strategy
- Economy hotels offer good returns
- Light structures lower risk for chain
- Accor sold 171 properties in 2010
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- Figure 26: Summary of Accor’s hotel sales during 2010
- 49 hotels in sale leaseback deal
- Sofitel Paris Arc de Triomphe to be sold
- Accor continues to pare non-core assets
- Accor sells stake in Lucien Barrière for €268 million
- Accor is selling Lenôtre
- Choice Hotels International
- Choice’s brands
- Comfort Inn
- Comfort Suites
- Quality
- Ascend Collection
- Clarion
- Sleep Inn
- MainStay Suites
- Econo Lodge
- Rodeway Inn
- Suburban Extended Stay Hotel
- Cambria Suites
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- Figure 27: Choice’s brand portfolio, pipeline, additions, repositionings, terminations, 31 December 2010
- Geographical spread
- Two business models
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- Figure 28: Choice’s ex-US hotel portfolio by country and type of franchise structure, 2011
- Franchise agreements
- Master franchise terms
- Franchise agreements individually negotiated
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- Figure 29: Quoted franchise fees by brand as of 31 December 2010
- Starwood Hotels & Resorts
- Hotel brands
- Sheraton almost half of capacity
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- Figure 30: Starwood’s hotel capacity by brand, 31 December 2010
- Comparatively little franchising
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- Figure 31: Starwood’s hotel capacity by asset management structure, 31 December 2010
- Geographical spread
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- Figure 32: Starwood’s hotel portfolio by region, 31 December 2010
- Making big play for China
- Carlson Hotels Worldwide
- Mainly franchises
- Rezidor
- Carlson’s hotel brands
- Radisson
- Park Plaza
- Country Inns & Suites
- Park Inn
- Carlson’s lodging portfolio and pipeline by brand and region
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- Figure 33: Carlson’s hotel portfolio and pipeline by brand, 31 March 2011
- Figure 34: Carlson’s hotel portfolio and pipeline by region, 31 March 2011
- Regent sold
- Expansion in India – Country Inns & Suites and Radisson
- Adapting the product to the Indian market
- Five opening in 2011
- Radisson in India
- Four new hotel signings in China
- Carlson’s partnership with LRA Worldwide
- Carlson debuts new guest loyalty programme
- An introductory promotion
- Partnership with Club Med
- Hyatt Hotels Corporation
- Moderate growth of portfolio
- An asset-light strategy
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- Figure 35: Hyatt’s hotel portfolio by region and asset management structure, 31 December 2011
- Hotel brands
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- Figure 36: Hyatt’s hotel brands, 31 December 2011
- Park Hyatt
- Andaz
- Grand Hyatt
- Hyatt Regency
- Hyatt
- Hyatt Summerfield Suites
- Hyatt Place
- Hyatt grows Summerfield with two deals
- LodgeWorks acquisition
- An entrée into new markets
- 16 conversions to Summerfield Suites
- US$80-million JV with Noble
- JV offers access to financing in a difficult environment
- Home Inns & Hotels Management
- An IPO on NASDAQ in 2006
- Capacity trebled in three years
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- Figure 37: Summary of operating data, 2007-10
- 40 more hotels added in Q1/2011
- 86 more in Q2/2011
- Over 1,000 hotels by year-end 2011
- Shanghai World Expo boosted performance in 2010
- A standardised format
- A new midscale brand
- Property management and distribution
- Customer profile, pricing and distribution channels
- A fast-growing frequent-guest scheme
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- Figure 38: Home Inns bookings by channel, 2010
- Home Inns acquires Motel 168
- 281 more hotels
- Motel 168 brands to be retained
- Financing the deal
- Improving Motel 168 performance
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The Ten Biggest Consortia Worldwide
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- Figure 39: The 10 biggest consortia worldwide, year-end 2009
- Utell Hotels & Resorts and Utell Connect
- Best Western International
- A non-profit co-operative
- Service standards basic
- Best Western Premier
- Portfolio by region
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- Figure 40: Best Western’s portfolio*, 2011
- A cheaper alternative
- More than 40 hotels in Asia and the Middle East pipeline
- A spa concept
- Emerging markets
- South America, CIS countries and New Zealand
- Supranational Hotels and Hotusa
- Great Hotels of the World
- Keytel International
- Preferred Hotel Group
- Associated Luxury Hotels International
- Worldhotels
- Magnuson Hotels
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Chain Penetration
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- Figure 41: Hotel capacity and estimated chain penetration worldwide by region, 2009
- Leading chains in China
- Domestic budget operators in lead
- Wyndham, the leading foreign chain
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- Figure 42: A list of hotel companies* with at least 10 properties in China, 2011
- Penetration in Europe varies greatly by country
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- Figure 43: Hotel capacity and estimated chain penetration by selected country, 2009
- Top brands
- UK budget brands growing fastest
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- Figure 44: Top 10 brands in the EU-27, 1 January 2010 & 2011
- Top brands in the US
- Hilton gaining share
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- Figure 45: Top 20 hotel brands in the US (ranked by room count), 2011
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Financing, Insolvency, Mergers and Acquisitions
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- Financing still difficult
- Some owners forced to sell or commit more equity
- The situation of small hotels is dire
- A wave of refinancing to come
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- Figure 46: Fictive example of bank refinancing, 2007 & 2012
- Conservatively financed institutional deals
- 30-40% equity
- Austrian banks more open
- Slowdown in the CMBS market hits hotel financing
- CMBS investors more cautious
- Strict lending criteria
- New hotels favoured but no financing for development
- Insolvency still a problem
- Californian hotels on the rocks
- Defaults minimised by Extended Stay buyout
- Foreclosures up 91% in Q2/2011
- The Ritz foreclosed
- RBS takes over 42 Marriott hotels in UK
- Properties continue to be operated by Marriott
- Property to be sold to recover debt
- Can it get any worse in Ireland?
- One third of Irish hotels in trouble
- Four- and five-star segment hardest hit
- ADR down by 20%
- Four Seasons Dublin sold for a pittance
- Swiss hotels could also be in trouble
- Paulson seizes former CNL Hotels
- CNL was the second-largest hotel REIT
- Deal financing
- Von Essen bites the dust
- A breach of loan covenants
- Too many hotels bought too quickly
- Lack of economics of scale
- Portfolio to be sold off piecemeal
- Halcyon boss in von Essen bid
- Deals are still getting done
- Extended Stay purchased out of bankruptcy
- An effective short sale for Blackstone
- Blackstone, the world’s largest hotelier
- Interstate acquired by Thayer Lodging and Jin Jiang
- Interstate Hotels & Resorts
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- Figure 47: Interstate managed and owned hotels by franchised brand, 2011
- Thayer Lodging Group
- Jin Jiang
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- Figure 48: Jin Jiang’s total hotel portfolio, including properties under development*, 31 December 2010
- New World Hospitality acquires the Rosewood brand
- 19 luxury hotels in eight countries
- New World purchases five Rosewood properties
Distribution Trends
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- Distribution costs per channel
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- Figure 49: Cost of booking for chain and independent hotels by distribution channel, 2010
- Independents rely more on intermediaries
- Recent trend in major chain booking channels
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- Figure 50: Breakdown of CRS bookings by channel, major chains, 2006-10
- Brand sites have lost share
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- Figure 51: Breakdown of CRS bookings by Internet channel, major chains, 2006-10
- Why do hoteliers use the opaque channel?
- A third of rooms booked via electronic channels
- A sample of 25,000 hotels
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- Figure 52: Distribution channel breakdown by hotel grade, 2009-11
- Property direct the main channel
- OTAs less important than generally believed
- ... but still cost US hoteliers US$2.5 billion
- OTAs’ share rose from 1.34% to 7.35% in ten years
- OTA channel should be broken down
- Two ways of looking at OTAs
- Destination effect
- Google Hotel Finder
- Direct booking or via OTAs
- 5th Annual Benchmark Survey on Hotel Digital Marketing
- Participant profile
- Hotel website revenues
- Digital marketing budgets higher
- Shift to online from offline
- A changed attitude towards social media
- Importance of mobile Web
- Hotel digital marketing budget breakdown
- Are hoteliers budgeting adequately for this demand?
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- Figure 53: Breakdown* of hotels’ Internet budget, 2006-11
- Renewed focus on website design
- Where is the ROI?
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- Figure 54: Internet marketing formats rated by ability to produce the best results and highest ROI*, 2007-11
- Mobile marketing objectives not achieved in 2010
- Mobile still growing exponentially
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- Figure 55: Mobile marketing initiatives planned for 2011, 2001-11
- A decline in planned iPhone apps
- Social media
- Trend towards dedicated social-media personnel
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- Figure 56: Type of Web 2.0 and social media marketing initiatives planned for the coming year, 2011*
- Planning for video
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- Figure 57: Online video initiatives planned for 2011*
- Overall conclusion
- Flash sale sites are threat
- Multi-channel strategy most effective
- Marketing campaigns should be released simultaneously
- Organic search versus paid search
- Organic search engine optimisation
- Linkage through keywords
- Paid search on the rise
- Use of AdWords and PPC advertising
- How does it work?
- Paid search may be cheaper than OTAs
- Social media’s impact on hotel distribution
- TripAdvisor
- The problem of fake reviews
- TripAdvisor tussles with Google
- TripAdvisor to be spun off
- Impact on revenue management
- The challenge of flash sales
- Choosing individual rooms now possible
- Room 77
- Hard and soft metrics
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- Figure 58: ‘Hard’ and ‘soft’ benchmarking metrics, 2011
Spas and Wellness
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- Overview of US spa sector
- Facilities
- Services and products
- Prices and revenue breakdown
- Client profile
- Is the spa craze over?
- No longer just an amenity but a profit centre
- Average treatment rate
- Treatment room utilisation
- Therapist productivity
- Revenue per available treatment room
- Revenue per guest
- Revenue per square foot/square metre
- Spa revenue per occupied room
- Spa sector has held up better in Germanic world
- No contradiction between quality and ‘medical to go’
- Intangible factors more important
- Hoteliers need to analyse profitability of spa operations
- Hotel spa trends and performance in Asia Pacific
- Spa versus hotel performance
- Spa visits from in-house guests
- Spa KPIs forecasted to improve in 2011
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- Figure 59: Hotel and resort spa performance in Asia Pacific, 2008-11
- Tracking KPIs crucial for planning and adapting to market changes
- Six Senses restructures its brand portfolio
- People instead of architecture
- 14 resorts and 14 spas
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- Figure 60: Six Senses spa resorts by brand and country, 2011
- Branded residences
- Starwood’s push into Asia and Middle East
- Shine Spa for Sheraton
- Heavenly Spa by Westin
Corporate Social Responsibility and Sustainable Development
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- Hotels can mitigate their impact
- Green Globe
- Heritage Environmental Certification Programme
- Structure
- The Green Globe programme
- Membership fees
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- Figure 61: Annual Green Globe membership rates* for hotels (consulting and auditing not included), 2011
- International Tourism Partnership
- ‘Environmental Management for Hotels’
- greenhotelier magazine
- ITP members
- Client attitude
- Men and business travellers most concerned
- Brazilian and Chinese concerns
- Guests apparently prepared to make some concessions
What Next?
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- A contracting US pipeline
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- Figure 62: US hotel pipeline for July 2011
- Many regions show growth ex-US
- Asia Pacific leads ex-US development
- London in the lead in Europe
- Soaring growth in Qatar and United Arab Emirates
- A rebound in Haiti
- Private to public?
- When will Hilton be sold?
- Rumours of flotation
- Integration of the two Hiltons complete
- Starwood Capital to sell Louvre?
- Africa the new frontier?
- Steady growth expected in the next few years
- Few hotels of international standard
- International brands step up the pace across the region
- Accor
- Best Western
- Hilton
- Marriott
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- Figure 63: Development pipelines for branded hotel development in sub-Saharan Africa, 2010
- US$500 million invested in hotels in Nigeria
- A Golden Tulip opens in Lagos
- The InterContinental Hotel Lagos and two Radissons
Index to Travel and Tourism Analyst
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- Index grouped by geographic area
Index to TTI Destination Reports
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- Country reports
Special Reports Index
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