Breeze Hotel, the hospitality arm of Chennai-based Rajathi Group, is planning to invest around Rs 500 crore in setting up hotels in tier-II cities across Tamil Nadu and Andhra Pradesh.
The company is planning to fund these projects through debt and equity which will be undertaken in two phases.
R S Ashok, CEO, Rajathai Group, said that the proposed would be in two phases.
Investment for the first phase would be Rs 250 crore, of which Rs 150 crore will be debt and Rs 100 crore will be equity.
S Amarendran, CEO, Breeze Hotel, as part of the first phase company will build hotels in Sriperumbudur (with convention centre), Coimbatore, Tiruchy, Tuticorin and Madurai.
Land acquisition is already over except in Tuticorin and Madurai. Each hotel will be in 2 acres, while Sriperumbdur property alone will be built in 5 acres of land.
Minimum capacity would be 75 rooms. Construction works are expected to commence by March 2009.
Sriperumbudur, Coimbatore and Tuticorin property will commence its operations by the year 2011 and it would come under 3-Star premium business category.
In the second phase company will foray into cities like Ooty, Kanniyakumari, Kumbakonnam, Yercaud, Vellore, Rameshwaram, Kodaikanal and Cuddalore in Tamil Nadu and in Andhra Pradesh, Krishnapattnam and Vishakapattinam.
The expansion plans will adopt a combination of green field projects, joint ventures, hotel management arrangements or out-right purchase of existing properties in the targeted cities, said Amarendran.
Rajathi Group's primary interest is in agro products and had reported a turnover of Rs 500 crore last year.
