City-based real estate developer, Hiranandani Group is looking to collectively invest over Rs 640 crore towards development of five new hotels which will add more than 550 rooms over a period of next 2-3 years.
The company is in talks with about eight international hotel brands for management contracts that will come up in metros like Mumbai, Bangalore, Chennai and Hyderabad.
Some of the hotels with which Hiranandani is in talks with include Accor Hospitality, InterContinental Hotels Group, Global Hyatt Corporation and Hilton Hotels among others.
One out the five properties, which will come up in Chennai will be a boutique hotel with 60-70 rooms and built at a cost of Rs 30 crore. The other hotel in the same city will be a 5-star rated hotel and will have 350 rooms, built with an outlay of Rs 375 crore.
Its Mumbai hotel, will come up in Powai next to its existing hotel called Rodas, at a cost of Rs 140 crore. Work on this new hotel with 148 keys has already started and is scheduled to be completed by September-October this year.
The hotel property coming up in Bangalore will see an investment of Rs 96 crore although the company is yet to finalise on the number of rooms for this property. The company’s another green field hotel coming up in Hyderabad is on the concept stage at the moment and final plan on number of rooms and investment is yet to be drafted.
Surendra Hiranandani, managing director, Hiranandani Construction said, “We are in talks with a number of international hotel companies to develop our properties. We intend to begin construction of the Chennai hotel by October after we finalise the partner.”
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The company plans to fund the expansion programme through debt and reserves in an equal manner. “We are confident of raising the debt required for the projects,” stated Hiranandani on being questioned about the availability of debt fund in such a market.
Instead of opening the entire hotel at once, the company, will go in for a phased inauguration for the Chennai property with an aim to maximise its cash flow standing.
“We are looking to start with 100 rooms in the first phase and when revenue starts to flow in, then gradually we will open the remaining half of the hotel”, said Hiranandani.
Its new property in Powai, Mumbai, which will come up inside the Hiranandani Gardens will cater to corporate clients in the immediate vicinity of the property.
Rodas, the 38-room ecotel hotel, meanwhile, will be shut for a short duration for renovation after the opening of the new yet-to-be-named hotel.
Kamat Hotel management wing Concept Hospitality will remain as the management partner of this new 5-star hotel. Concept is currently in charge of the Rodas.
Despite a downturn in the hotel industry seen currently with international inflow of travellers drying up, domestic hoteliers are optimistic of a revival in 2-3 years time.
As senior official from Hotel Leelaventure said, “The hotel industry is going through a turbulent phase because of the economic meltdown and also due to the recent terror attacks in Mumbai. But the business should bounce back in at least the next 2-3 years but growth may not be sharp.”