Leelaventure to invest $20 m in Mumbai hotel

Hospitality major Hotel Leelaventure Ltd will invest $20 million as part of a plan to upgrade its Mumbai property. Plans are also on to renovate nearly 150 of the existing 435 rooms in Mumbai.

"We are investing $20 million as part of our Phase-I investment in the Mumbai property. This investment should help us become the top player in the Mumbai hospitality sector within six months," Peter J Leitgeb, the newly-appointed president-operations, said.

The group, in order to have a pan-India footprint, is also evaluating some properties in New Delhi, Chennai and Udaipur. It remains to be seen whether the group would commence operations in these cities through acquisitions or build and operate its own property.

"Our decision to enter the other three markets may be late. But, we are confident that we have a unique product mix and will make a significant impact in these markets as well," Leitgeb said.

The average room rent (ARRs) of the group's Mumbai property increased 13 per cent to cross Rs 4,200 during the financial year ended March 31 2004 compared with the previous fiscal.

Other leading hotels in Mumbai also saw a similar increase in their ARRs during the previous fiscal.

Buoyed by the fact that The Leela Palace Kempinski-Bangalore has once again bagged the "CNN Ultimate Service Award" for 2003-04, Leitgeb added that the property will be the benchmark for all future expansion plans of the group.

The Bangalore property had an ARR of Rs 7,891 for 2003-04, up 28 per cent compared with Rs 6,185 during the previous year. This is the only hotel in India to bag this award for the second consecutive year.

For the year ended March 31, 2004, Hotel Leelaventure posted a 53 per cent rise in revenues to Rs 207.70 crore. The net profit of the group rose by 32 per cent to Rs 6.46 crore. Of its total revenues, Mumbai accounted for about Rs 70 crore, while the Bangalore property contributed nearly Rs 100 crore.

Leela's property in Goa accounted for the balance.