Hyatt in JV with Asian Hotels' Saraf

With the boom in the tourism and hotels sector, international hospitality chains have started investing in India. This marks a radical shift in their earlier strategy when they were just lending their brandnames and managing properties.

After strengthening its relationship with the Sarafs, the co-promoters of Asian Hotels, the US-based Hyatt has now decided to directly invest in properties in the country. Earlier, Inter-Continental had acquired a token stake in an Indian hotel.

Hyatt has entered into an equal joint venture partnership with the Sarafs for setting up three properties "" in Mumbai, Bangalore and Kolkata.

Their first property "" Grand Hyatt "" is being set up in Mumbai with an investment of Rs 620 crore. The 547-room hotel will be opened next month. Juniper Hotels, the holding company of the Grand Hyatt, Mumbai, is funded through a mix of equity and debt.

Its equity capital is pegged at around Rs 200 crore.

Arun Saraf, executive director of Asian Hotels, said: "Hyatt has picked up a 50 per cent stake in Grand Hyatt, Mumbai".

According to Saraf, this is one of the largest investments made by an international hospitality chain in the country. "We are now looking to acquire land in Bangalore to set up a second hotel. We will later look at Kolkata," Saraf added.

Last year, the US based Inter-Continental had acquired a token stake (5-10 per cent) in GL Hotels, which operates the boutique hotel The Inter-Continental (formerly Natraj Hotel) in south Mumbai.

Hyatt International, part of the Hyatt group, owns brands such as Hyatt Regency, Grand Hyatt, Park Hyatt and Hyatt Resort and Spa. Asian Hotels, promoted by Sarafs, Jatias and Guptas, owns the Hyatt Regency in Delhi, Kolkata and Mumbai. These properties are managed by Hyatt International.

Hyatt also manages the Hyatt Resort and Spa in Goa, which is owned by Sushil Suri of Morepen Laboratories. The Sarafs also own two hotels in Katmandu ""the Yak & Yeti, the oldest 5-star hotel, and Hyatt Regency.