Welcome to the Wyndham Hotels & Resorts fourth quarter and full year 2021 earnings conference call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. Lastly, if you should require operator assistance, please press star zero. I would now like to turn the call over to Matt Capuzzi, Senior Vice President of Investor Relations.
Thank you, operator. Good morning, and thank you for joining us. With me today are Geoff Ballotti, our CEO, and Michele Allen, our CFO. Before we get started, I want to remind you that our remarks today will contain forward-looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. These risk factors are discussed in detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC. We'll also be referring to a number of non-GAAP measures. Corresponding GAAP measures and a reconciliation of non-GAAP measures to GAAP metrics are provided in our earnings release, which is available on our investor relations website at investor.wyndhamhotels.com.
We are providing certain measures discussing future impact on a non-GAAP basis only because without unreasonable efforts, we are unable to provide the comparable GAAP metric. In addition, last evening, we posted an investor presentation containing supplemental information on our investor relations website. We may continue to provide supplemental information on our website in the future. Accordingly, we encourage investors to monitor our website in addition to our press releases, filings submitted with the SEC, and any public conference calls or webcasts. With that, I'll turn the call over to Geoff.
Thanks, Matt, and thanks everyone for joining us this morning. 2021 once again demonstrated the strength of our brands, the resiliency of the leisure traveler, and the benefits of the select service economy and midscale segments. Many of our franchisees reported the best year they've ever experienced since owning their hotel. Our team's significant progress and accomplishments throughout the year contributed to these outstanding results, positioning our owners and our business for future success. We delivered $590 million of adjusted EBITDA for the full year, over $250 million more than last year, and only 5% below 2019. We generated $389 million in free cash flow, over 10x more than last year, and $330 million more than we did back in 2019.
We closed the year with net room growth in line with our expectations at 1.8%. In the United States, openings for the full year were 96% of 2019 levels, and importantly, we saw significant improvement in domestic demand as we progressed throughout the year. In the fourth quarter, we opened 9,900 rooms, which was 20% higher than 2019's openings. With the transaction markets and single asset sales picking up, conversion room openings increased over 35% in the fourth quarter versus 2019. Room openings internationally ran 75% of 2019 levels, also accelerating throughout the year as they did domestically. In the fourth quarter, we opened 82% of the rooms opened in 2019 as travel restrictions were lifted and owners felt more confident about rising demand. International net room growth was 4%.
Our China direct franchising business led the way with double-digit net room growth, followed by Latin America at 7% net room growth. We introduced 11 of our 22 brands into 18 new countries and territories, strengthening our foundation for future franchise growth in those regions, including our first Registry Collection Hotels in Mexico and Panama, our first Trademark hotels in New Zealand and Fiji, and our first La Quinta hotel in the United Arab Emirates. On the retention front, we saw improvements both domestically and internationally. In the United States, we achieved our 95% retention target, up from 93% last year and back in line with 2019. Internationally, our retention rate also improved to 95%, up from 89% last year and up from 94% back in 2019.
As our room openings and retention rates improved throughout the year, so too did our development signings. We awarded 20% more contracts globally in the fourth quarter compared to last year and 6% more than we signed in the fourth quarter of 2019. In the United States, we awarded 33% more contracts in the fourth quarter versus 2019, bringing our full year domestic executions to 331 deals or 11% more than what the team signed in 2019. With solid select-service fundamentals and increasingly improving developer confidence, new construction signings showed continued strength in the fourth quarter. Our U.S. franchise sales team signed 133 new construction contracts in 2021, which was 23% more than last year and 32% more than 2019.
We saw strong demand for our new construction La Quinta Del Sol, our Hawthorn Suites, and our Microtel Moda prototypes, given the efficiency of their construction and the market share outperformance of the brands. Acknowledging our strength in the economy space and recognizing increased consumer demand for affordable extended stay product, we will be launching later this spring. Our first extended stay brand for the economy segment. A brand we have been designing over the past year in consultation with several of the industry's most experienced extended stay developers. We are very excited about the prospects for this new brand, and we look forward to sharing more about it in the months ahead.
On a global basis, for the full year, we signed 655 agreements throughout 2021, representing over 82,000 rooms, including nearly 590 direct franchise and management agreements, 12% more than 2019. Our development pipeline grew by more than 5% to over 1,500 hotels for a record 194,000 rooms, or 24% of our current system size. Our brands led the travel sector recovery outperforming their competitive sets by 350 basis points versus 2019, and outpacing overall industry RevPAR growth by 1,400 basis points compared to pre-pandemic levels. In the fourth quarter, U.S. RevPAR grew by 9%, and each month of the quarter saw stronger growth in the month prior.
Our December RevPAR in the midst of the Omicron surge was the strongest demand month of the quarter, growing 15% domestically. On top of the overall pricing power that leisure-oriented hotels have been experiencing, our brands have gained nearly 300 basis points of ADR index since the start of the pandemic. As we've introduced new pricing tools and increased franchisee education on how to forecast more accurately, how to price more confidently, and how to achieve greater profitability, we're driving rate index gains across every chain scale in our portfolio. In the year ahead, we will upgrade our automated revenue management system with new competitive rate shopping intelligence, new mobile enhancements, and the latest in revenue management technology, software, and algorithms. Our direct digital channels continue to outpace higher cost third-party OTA channels.
Revenue from brand web bookings increased 35% compared to fourth quarter 2019, benefiting from the success of our highly rated Wyndham app, which saw fourth quarter mobile app bookings increase over 40% versus 2019. Our award-winning loyalty program is another significant driver of direct business demand and market share growth. From partnerships to promotions, we're making investments that make Wyndham Rewards even more generous. Wyndham Rewards now stands at over 92 million members, and the program's overall domestic share of occupancy grew 350 basis points versus 2019 to nearly one out of every two guests. Our largest growth segment from a demand standpoint, Generation Z, Millennials, and Generation X travelers now make up 65% of all arrivals.
We continue to nurture our relationship with these younger guests via our new customer database platform powered by Amperity, using the recency, the frequency, the channel, and the communication preferences that they're accustomed to, ensuring that we're reaching them at the right time, in the right way, and with the right message to keep them booking with us for their next trip and for the trip after that. Just as 2021 domestic leisure demand outpaced last year, so too did demand from our everyday business travel segments. Infrastructure accounts, which represent the majority of our domestic business segment, contributed over 10% more revenue to our hotels in the fourth quarter than in 2019 and made up half of the newly negotiated business accounts that our sales team signed this year.
It's a trend that we expect to continue given the recent passage of our nation's $1.2 trillion infrastructure bill. Our franchisees are slowly seeing staffing levels for their hotels recover to their required needs, with housekeepers remaining the most in-demand position. While labor as a percentage of revenue runs nearly 35% for the overall U.S. industry, it runs significantly lower in the select-service hotel space at around 12% for economy and mid-scale hotels. With our continued move to digital check-in and check-out, combined with services like our auto call routing, moving labor out of our franchisees' front offices to professionally run call centers, our franchisees can drive efficiencies in their operations and flow more revenue to their bottom lines. In the year ahead, we will introduce new tools and services to help our owners further reduce operating costs at their hotels.
Consumer intent to travel continues to strengthen, and average lengths of stay continue to surpass 2019 levels. Thursday and Sunday nights hit historic Q4 levels of occupancy as guests extend their weekend leisure travel plans and increase their work trips for personal travel. Weekend and short four-night breaks continue to generate the largest percentage of leisure stays, followed by travel to visit family and friends, with our customers driving longer distances from home. In consumer survey after survey, people are indicating their desire to begin traveling again. MMGY's Q4 Leisure Travel Intent Survey reveals an increasingly bullish consumer where over 70% of leisure travelers intend to book in the next three months, portending a very busy spring break for our franchisees.
With nearly 90% of Wyndham's domestic room nights generated by drive-to demand and travel by car remaining the number one travel preference among leisure travelers surveyed, we remain best positioned to continue to capture an outsized share of travel demand in the year ahead. As we look ahead, we will continue to further simplify our business model. We were very pleased in the fourth quarter to negotiate our exit from the resource-intensive, lower-margin select service management business. At the same time, with significant interest from buyers of leisure real estate, we began exploring the strategic sale of our two owned hotels, the Wyndham Grand Bonnet Creek Resort in Orlando and the Wyndham Grand Rio Mar Resort in Puerto Rico. We'll be updating you in the coming months on the progress of those deals.
Before handing the call over to Michele, I'd like to take a moment to thank our team members who have been more productive than ever over the past two years. This past October, we were incredibly proud to be ranked number four among Newsweek Magazine's 100 Most Loved Workplaces, followed by being named among Newsweek's Superior Environmental and Social Responsibility Practices. Just last week, Forbes Magazine recognized Wyndham on its 2022 list of America's Best Employers. Furthering our commitment to diversity and advancing women entrepreneurs in hotel ownership, we were also very proud to welcome our first franchise member of our Women Own the Room initiative earlier this month, who will be breaking ground on two dual-brand La Quinta and Hawthorn Suites prototypes in Austin and Georgetown, Texas.
Our inclusive economy culture, built on personal accountability, built on responsibility, has continued to resonate among our team and our ownership community. For the fourth consecutive year, we were delighted to receive another perfect score on the Human Rights Campaign's 2022 Corporate Equality Index measuring LGBTQ workplace equality. We know that none of this recognition would be possible without our valuable team members who pride themselves on making a meaningful impact on our industry, on the lives of our franchisees, and on all of those around them. With that, I'll turn the call over to Michele. Michele?
Thanks, Geoff, and good morning, everyone. I'll begin my remarks today with a detailed review of our fourth quarter and full-year results. I'll then review our cash flows and balance sheet, followed by our 2022 outlook. We generated $314 million of fee related and other revenues, and $131 million of adjusted EBITDA in the fourth quarter, bringing our full-year fee related and other revenues to $1.25 billion, and adjusted EBITDA to $590 million, both well above our expectations. Fourth quarter global RevPAR grew 52% year-over-year on a constant currency basis, 58% in the U.S., and 40% internationally.
Versus 2019, RevPAR was up 9%, led by our economy brands, which were 19% above 2019, followed by our midscale brands, which also continued their sequential climb, surpassing 2019 levels by 5%. ADR exceeded 2019 by 8%, while occupancy exceeded by 2%. Notably, 79% occupancy levels in the fourth quarter. National park and beach destinations led the way. The South Atlantic region, where nearly a quarter of our system is concentrated, grew RevPAR 12%, and national park destinations, where about 4% of our system is located. Internationally, RevPAR continued to improve to 81% of 2019 levels, up from 75% in the third quarter. Outside of China, all international regions experienced significant sequential improvement from the third quarter despite COVID spikes and new variants.
Canada improved to 91% of 2019 levels, up from 83% in the third quarter, up from 75% in the third quarter. Recovery in China continued to moderate during the fourth quarter at 77% of 2019 levels as a result of sustained lockdowns, and we anticipate that this trend will continue until restrictions are once again lifted following the Beijing Olympics. Full-year fee related and other revenues grew to $1.25 billion, up 31% versus prior year, and adjusted EBITDA increased 76% to $590 million. Versus 2019 fee related and other revenues recovered to 87%, and adjusted EBITDA recovered to 95%, which included a 3-point benefit from a marketing fund surplus generated this year.
The marketing fund surplus was $18 million better than what we expected as RevPAR continued to outperform our expectations throughout the year. This surplus reflects a partial recovery of last year's $49 million investment, which puts us ahead of schedule on recovery. Full year global RevPAR recovered to 88% of 2019 levels, with domestic RevPAR at 97%. Global openings were at 84% of 2019, and our retention rate of 95% was in line with 2019 and our stated goal. Our adjusted EBITDA and franchising margins both improved versus 2019. Our adjusted EBITDA margin increased 450 basis points, which primarily reflects 300 basis points from the changes we made to our cost structure last year, and a 150 basis point benefit from the marketing fund surplus.
Our franchising margin, calculated on the same basis as our peers, which excludes the effects of the marketing funds, increased 250 basis points to 83%, again reflecting our long term cost savings initiatives. Adjusted diluted EPS improved to 96% of 2019 levels, further reflecting lower interest expense as a result of the August 2020 note issuance and the subsequent call of the 2026 higher interest notes, as well as the impact of our share repurchases. We generated $389 million of free cash flow in 2021 compared to $34 million last year and $50 million in 2019. With the acquisition and integration of La Quinta now fully behind us, the significant cash flow generation capabilities of our business model have, as promised, materialized.
We were able to convert over 60% of our adjusted EBITDA into free cash flow this year. We returned over $190 million to our shareholders in 2021 through the payment of $82 million in dividends and the repurchase of $110 million of our common stock. We ended the year with over $900 million in total liquidity, and our net leverage ratio was 3.2x . With over $300 million of free cash flow expected to be generated in 2022, combined with the $84 million termination payment from CorePoint Lodging, we will have over $400 million of cash to deploy. Our first priority is always to invest in the business. We will continue to increase development advances in key money in support of net room growth.
We expect to see the launch of our new economy extended stay brand, Geoff referenced earlier, and we will continue to incentivize franchisees to invest in certain new brand prototype designs to improve overall brand equity. We also expect to continue to be a regular dividend payer, subject naturally to board approval. Beyond these priorities, we will look to allocate cash flow to acquisitions that are strategic and accretive to both earnings and net room growth and to share repurchases with the amount going to each, depending largely on the opportunities that are available. Our board last week increased our share repurchase authorization by $400 million, reflecting its continued commitment to shareholder return and the ongoing strength of our business. Now turning to outlook. In 2022, we expect global net rooms growth of 2%-4%.
For RevPAR, we are projecting an increase of 12%-16% year-over-year, which is relatively flat to 2019. This assumes continued strong trends in the U.S. and importantly, continued improving results internationally. We expect fee related and other revenues of $1.34 billion-$1.37 billion. We are projecting adjusted EBITDA of $605 million-$625 million in line with 2019 levels. Adjusted net income is expected to be $308 million-$320 million, and adjusted diluted EPS is projected at $3.28-$3.40 based on a diluted share count of 93.9 million, which excludes any potential share repurchases.
Finally, we're expecting free cash flow conversion from adjusted EBITDA of approximately 55%, about 10 points less than 2021, which reflected a benefit from the collection of COVID fee deferrals and a one-time true-up payment from TNL related to the annual license fee minimum. As we bridge this outlook back to 2019, we remind you of the following and encourage you to review slide 14 in the investor presentation we posted to our website last night. In 2022, our outlook includes $5 million of adjusted EBITDA from CorePoint, as this business is included only through its expected sale date in March. License fees are projected at 71% of their 2019 levels or $80 million. This projection includes license fees from both TNL and Platinum Equity and is based on internal estimates.
The recovery of this fee stream to 2019 levels is largely correlated to the recovery of vacation ownership sales at TNL. We will update as appropriate when and if TNL provides an estimate for vacation ownership interest sales. Outlook for the core business implies adjusted EBITDA growth of 7%-11% versus 2021 and 6%-10% versus 2019. Keep in mind, while we are in the process of marketing the sale of our two owned assets, as Geoff mentioned, our outlook assumes no change in ownership. Substantially recover to pre-pandemic levels for our value and outperform their competitive sets. Our investments in digital innovation and technology are providing our franchisees with the support they need to drive improved operating margins. Our business, which we continue to simplify, is generating significant free cash flow that we are putting to work for our shareholders.
We are enthusiastic about building on our successes and capturing the opportunities that lie ahead in 2022. With that, Geoff and I would be happy to take your questions. Operator?
The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. Again, we do ask that you limit yourself to one question and one follow-up. Thank you. We'll take a question from Joe Greff of J.P. Morgan.
Good morning, everybody. Geoff, I was hoping you can give us a little bit more detail on this extended stay brand launch. You know, how will that be positioned versus what Choice and I guess what Blackstone and Barry now own with the Extended Stay America brand price point, the value proposition to hotel owners. Can you just talk a little bit more about that, please?
Sure. Thanks, Joe. I think it'll be positioned right alongside. I mean, extended stay demand has proven to be just absolutely recession and pandemic proof, and we know that the demand is growing. I mean, we've seen in our upper midscale extended stay brand with Hawthorn Suites, a 50% increase in our pipeline over the last year. We know that demand is out there for an extended stay economy brand. You referenced brands that are doing very well in that space. Our developers are asking for an economy extended stay brand. Our franchisees are asking for it. Most importantly, our corporate accounts are asking for it. I mean, we know that there are over 10 million construction workers out there that travel every week.
We also know that relocation and long-term assignments are gonna continue to pick up. We're gonna see we feel millions of more essential workers hitting the road with the coming infrastructure bill and keeping that industry-wide extended stay average daily rate occupancy, you know, up in the high 70s and 80% range.
These are our customers, these are our business accounts. So last year, we assembled a developers council with many of the nation's top extended stay developers to really help us think through the design, the room counts, the operational processes, and to help us design a prototype that they know will work and that they will wanna build themselves. I mean, many of these developers have already built other new construction prototypes before of ours. They've worked with our award-winning architectural design and construction team, who we couldn't be happier with, that we inherited from La Quinta.
I mean, this is a team that's designed and opened over 150 La Quinta Del Sol prototypes over the past few years and designed our new Hawthorn Suites extended stay prototype and our new economy Microtel Moda prototype with the same approach. We know that there's demand out there. We think this will be more popular than our other new construction prototypes. I mean, our economy Microtel Moda, we signed over a dozen new construction executions in the fourth quarter alone, and we now have 13,000 rooms out there in the pipeline, and that economy brand grew in our pipeline 40% year-over-year. We think it is going to be more popular.
We're seeing very strong developer interest right now. We're already being asked by those developers for sites. We'll have a lot more to talk about in the coming weeks about it.
Great. Then my follow-up, maybe this is for Michele or Matt. Can you talk about the cadence of net rooms growth throughout 2022? Is it similar to past normal years or you know, how I guess, backend loaded it might be or not be? If you can give us some commentary there, that would help us.
Sure, Joe. Good morning. As you know, the net room growth is typically backend weighted. I wouldn't expect to see any changes to that as we move throughout 2022. I think what we're really focused on is making sure we're posting sequential net room growth every quarter. I think you'd expect to see the largest of that coming in the fourth quarter, as is typical for our business.
Great. And just one other one, if I could squeeze in there, Jeff. I thought what was interesting was in the fourth quarter, December stronger than November stronger than October, and December stronger despite the impact from Omicron. Can you talk about what you've seen so far, year-to-date, quarter-to-date? That's all for me, guys.
Sure. Yeah, no. It's really impressive, Joe. Michele and I are heading down on Monday to our resort in Orlando and meeting with 300 or 400 franchisees next week at one of our executive summits. We were told that Friday and Saturday night are sold out at average daily rates 20%-30% above what it was in 2019. The teams told us that that was the same for really every weekend through Easter for not only that hotel but our other hotels like the Wyndham Grand in Clearwater.
You know, we've been looking at the business on the books for our top 20 spring break markets, and it's running two times what it was versus the same time last year, led by California. We're seeing good demand in Florida. We're seeing off-the-chart demand Texas. You know, what we've seen, I could say over you know through the fifth, it'll be interesting to see what comes out in Smith. I think you'll see a little bit of softness last week because President's Week was a week earlier last year, and I think you'll see really strong demand this weekend. But what we've seen through the through the second of February was you know just again continued strong demand.
January was up 15% in our economy space, RevPAR. The week ending February 5th was also up double digits. You know, the last two months, the last eight weeks through the week ending February 15th, our economy RevPAR is running 19% ahead of where it was in 2019, and our midscale RevPAR is running 6% ahead of where it was in 2019. You know, look, we had expected seasonal lower occupancy this quarter, but we've been seeing increasing occupancy and increasingly occupancy growth in the midweek, which is where we think there's gonna be the real opportunity for us in the weeks and in the months ahead.
Thank you.
Thanks, Joe.
Our next question is from David Katz of Jefferies.
Hi. Good morning, everyone. Thanks for taking my questions. I wanted to ask about the kind of long-term trend line for net unit growth, right? As we sort of progress through all this, there's a lot of noise in the numbers. Where do you think the domestic and international net unit growth numbers kind of settle in for Wyndham as we think about, you know, how to value on, you know, your stock, right, on a long-term recurring basis?
That's a great question, David. Thanks for that. You know, domestically, we were really impressed with how, you know, domestic opens accelerated. We opened 10,000 rooms, which was 5,000 over last year and 20% more than 2019 in 2021. Domestically, our system grew 70 basis points in 2021, and it was back to the same levels that it was in 2019. We would expect growth to increase further domestically in 2022 and would expect to, you know, start the year. We're expecting to start the year with positive domestic Q1 growth. We'll continue to target and see growth in the midscale and above segments as strong as it's been.
We were thrilled with the 5% net room growth domestic increase in those segments in 2021. I think your question over the long term, you know, we have right now best in segment retention rates at 95%, as we've talked about. We're looking to move those to 96%. That, of course, would add another point to our domestic net room growth. We were able to achieve that in 2021. You know, with new launches like our new Economy Extended Stay brand, we're expecting strong growth from hotel brands like in that segment, and we're very optimistic about that. Internationally, we've seen really strong growth.
We had a 5% increase in our direct franchising business, a 4% international net room growth overall, in the fourth quarter, and we'll be looking to, you know, continue to move that up as we were able to do in 2019.
Perfect. As my follow-up, I'm gonna sort of wrap two things in there if it's okay, because I think they're interesting. You know, just in terms of capital allocation, with the launch of the Economy Extended Stay brand, is it potentially going to consume some capital in terms of key money or other inducements with it? As you know, I go back to Michele's commentary around prospective accretive acquisitions, which is normally part of the range of potential allocation options. If you could classify that just a little bit or help us with the boundaries of that, would they be immediately accretive? You know, and are there any boundaries of size or scale or type that you would or wouldn't consider seriously?
Sure, David. On the first part of your question related to the Economy Extended Stay brand, we will look to put a good amount of capital to work there. We are very interested in committing to the brand for long-term success, and you'll hear more from us about what that commitment will look like in the coming weeks. I would say we will absolutely expect some of those outflows this year, though, but those outflows will pick up much more meaningfully in 2023 and beyond. With respect to your M&A question, yes, immediately accretive to both earnings and net room growth. We look for opportunities globally, particularly in high growth markets or in regions where we have gaps in our portfolio.
You'll likely see bolt-ons of smaller brands, but nothing's off the table if it's a strategic fit, and again, value accretive.
Super helpful. Thank you.
Thank you.
Our next question is from Dany Asad of Bank of America.
Hey, good morning, Geoff, Michele and Matt. Geoff, can you maybe help us unpack your kind of that global RevPAR expectation for 2022 when we kind of think about it versus 2019? Can you kind of help us through either, you know, the progression through the year and also kind of if we were to kind of break out, you know, your U.S. expectations versus, you know, how you expect the international kind of state to recover through the year? Can you help us walk through that a little bit?
Hi, Dany. Sure. You'll see we finished the year 12% globally down, and our U.S. business was down only 3%, with international still down 30%. We're projecting at the midpoint of our guidance a flat for 2022 for RevPAR growth. It's not evenly distributed across the regions, though. We do expect the U.S. is going to lead the way, particularly in the economy segment, and they'll finish up year-over-year or even up versus 2019, clearly. Internationally, though, we're not expecting to get all the way back to 2019 levels. As we get through the first quarter with the Olympics and Omicron behind us and cross-border travel opening up, we expect meaningful improvement as we move throughout the year.
I would think I wouldn't be surprised to see China surpassing 2019 RevPARs in the back half of the year. I think we could easily end the year with U.S., China, and a couple of the other regions at or above 2019 levels, though some regions are still below 2019, particularly in Southeast Asia and some parts of the European continent.
Got it. That makes sense. My follow-up was a little bit unrelated, but you know, we've had several quarters now of like healthy loyalty rate growth, you know, globally in the U.S. also. If we look kind of, you know, your contribution to unit growth has been a lot more coming through the, you know, at the higher end chain scales, you know, your kind of what you categorize upscale and above. If that pattern continues for some time, you know, how would that affect that dynamic? Like, if that dynamic kind of goes on, how would that affect the loyalty rate kind of in the coming quarters and years?
Yeah. Loyalty rate, we think about it separately between domestic and international. You'll see in 2021, our domestic rate improved 2%, and that was on the back of 5% net room growth in the midscale and above category. That's a trend that we would expect to continue to hold. As we grow faster in some of those higher end categories, we should see some continued improvement in the overall domestic world. Nationally, we saw a 20% improvement in the loyalty rate for China this year, and that's reflecting our strategy to focus on direct franchising opportunities there and, as well as some of the benefits from the strategic terminations, we completed in 2021.
I would expect that, as we grow the direct franchising business in China faster than the masters, we would continue to see improvement in that royalty rate. Our long-term goal really is to steadily improve the royalty rates within each region. How that impacts the overall global rate will really depend more on the regional weighting of the system growth.
Got it. Thank you very much.
Thank you.
Our next question is from Stephen Grambling of Goldman Sachs.
Hey, everyone. Thanks for taking the questions. To start, I'd like to follow up on, and I think this was Joe's questions on extended stay and the launch there. Are there any upfront expenses or investments that you envision to ramp up, whether it's revenue management for the segment or a sales force, or will this largely leverage existing teams?
Sure. There are going to be some upfront costs because the majority of these teams will be dedicated to serving a different customer type than a transient hotel. Those costs right now are already reflected in our guidance.
Great. Maybe that dovetails into my second question, which is, as we think about the 2022 EBITDA guidance, I guess, can you give any sensitivity to, you know, maybe every 100 basis point change in RevPAR or how RevPAR performance across geographies might influence that sensitivity? Thanks.
Sure. About 100 basis point change in RevPAR is around $3 million of EBITDA impact. You would definitely see a higher RevPAR sensitivity for faster growth domestically than you would internationally. Clearly, it's more sensitive to changes domestically than it is internationally.
Great. Thanks. I'll jump back in the queue.
Thanks, Stephen.
Thank you.
Our next question is from Patrick Scholes of Truist Securities.
Hi. Thank you. Good morning, everyone.
Morning, Patrick.
Geoff, high-level, visionary question for you. You know, where in a couple of years do you envision your new all-inclusive brand? You know, how big could that be? Is a large growth strategy in your vision? Thank you.
I think in our vision for the extended stay economy brand we just talked about, you know, could be large. Alltra, as we've talked about, in the all-inclusive space, is going to be more strategic. We're working on several applications right now in the Caribbean, in Mexico, and in Central America. We've seen some interest as well in Europe, in places like Tenerife and Costa del Sol. You know, certainly the consumer interest in that space is growing. We've got a great partner with Playa. It will be opportunistic where it makes sense for us, both domestically and internationally.
You know, again, our focus is in the economy, in the mid-scale, select-service for those larger growth brands.
Okay. That's it for me. Thank you.
Thanks, Patrick. Our next question is from Ian Zaffino of Oppenheimer.
Hi, great. Thank you very much. Good quarter. Just wanted to maybe drill down a little bit on the cash flow statement. I'm kind of looking here. You know, you gave us the free cash flow conversion. You know, you gave us other ranges. You know, but if I do this, it looks like just about, I don't know, call it $340 million of cash flow. But then I guess if I kind of add in other things like CorePoint, I think that's a little bit under $100 million. Then also, you know, some of these asset sales, that's probably, I don't know, over $100 million, maybe $150-$200 million. I'm kind of getting up to, like a $600 million number.
You know, what do you do with it? How do we think about that?
Sure. Right. Yeah, I think that's the right way to think about it, Ian. They are going to be either allocated to investment in the business to support future growth or for shareholder return. The amount we allocate to each is going to depend largely on the opportunities that emerge to invest more heavily in the business. While we're eager to reinvest to create recurring earnings and cash flows, at the same time, we do place a high value of importance on shareholder return. There's no reason we can't do both. An asset-light business model warrants that.
Okay. Then if I just have a follow-up to this. The dividend that you authorized, how do you arrive or how are you now thinking about subsequent maybe dividend increases? Is there sort of a golden, you know, rule that you're following? You know, how do we think about that? Thanks.
Yes. Our dividend policy is to target low- to mid-30s net income payout ratio.
All right, great. Thank you very much. Good quarter again.
Thank you.
Our next question is from Daniel Adam of Loop Capital Markets.
Hi. Thank you, and good morning, everyone. Unlike some of your peers, your willingness to sort of stick your neck out there and offer detailed full year guidance is pretty commendable. I guess what gives you confidence in the outlook for the year? Then as a related follow-up, the 12%-16% RevPAR range for the year, is there any way you could further break that down between occupancy and rate? Thanks.
Hi, Daniel. Welcome to the call. I would say from an outlook perspective, our business is pretty predictable. It's demonstrated a high level of resilience, and we feel confident in being able to predict what we think the business will produce from an earnings and a cash flow perspective. With respect to occupancy and ADR split, we don't provide guidance for the individual components, but we would expect to see continued improvement in ADR and occupancy, and occupancy also recovering closer to its 2019 levels.
Great. Thanks so much.
Our next question is from Michael Bellisario of Baird.
Thanks. Good morning, everyone.
Good morning, Michael.
Just two sort of follow-up questions from me. First, for this new extended stay brand, what's your initial view of what a typical construction timeline is gonna look like? Then do you think this brand introduction will be enough to get you from your 2%-4% net unit growth target to your, I guess, into your longer term 3%-5% net unit growth target?
Sure. Mike, it's certainly gonna help. I mean, again, the demand out there that we're seeing from developers that have been side by side with us over the last many months developing this, and are beginning to have conversations with us. We, you know, we think that every 100, you know, hotels could add a, you know, a point or two to our net room growth domestically. In terms of timeline, we, you know, typically on all of our extended stay brands target anywhere between 18 and 24 months from planning to groundbreaking to opening. We think that'll be right in the same sort of ballpark in terms of timetable.
Got it. It's more of a 24 impact to net unit growth than, at least at this point, right?
Late 2023, 2024, yeah.
Got it. Just a quick second question on asset sales. Is there any tax impact that we should be aware of in terms of the gross versus net proceeds you might receive if and when you sell those hotels?
There will be a small tax impact, yes.
Okay. Thank you.
Thanks, Mike.
Thank you.
Actually, we have no further questions at this time. I'd be happy to return the call to Geoff Ballotti for any closing remarks.
All right. Well, thank you, Leo. Listen, thanks everyone for joining us this morning on what we know is an extremely busy day for many of you. Michele, Matt, and I very much appreciate your continued interest, of course, in Wyndham. We look forward to talking to you, Zooming with you, and much more importantly, hopefully, seeing you soon in person throughout 2022. Thanks again, everybody, and have a great day.
Thank you. This does conclude today's Wyndham Hotels & Resorts fourth quarter and full year 2021 earnings conference call. Please disconnect your lines at this time, and have a wonderful day.