NEW DELHI-In a $4-billion deal representing more than 10% of the country’s existing hotel inventory, Royal Indian Raj International Corp. has plans to build at least 12,000 budget-oriented rooms nationally. The contract with Choice Hotels India calls for construction to begin during the next 12 months on motels that will fly such flags as Clarion, Comfort Inn, Quality and Sleep Inn.
“There is a huge demand in the hotel and hospitality sector in the Indian Nation primarily in the under-represented three-, four- and five-star category,” Riric CEO Manoj Benjamin explains in a release. “This strategic partnership was forged to address these issues.”
The venture will further establish Riric’s position in the Indian hotel arena, he adds, part of a multi-faceted investment into the country that began in 1999. Featuring offices in Vancouver, England; London; and Bangalore, India, Riric is creating new transit and sewage infrastructure, and is also active in modernizing India’s commercial, housing and technology sectors to meet the demands being placed on the rapidly growing economy. The deal with Choice Hotels will put Riric’s direct investment into the country to date at more than $6 billion.
Choice Hotels India already has a substantial presence in India, but company officials maintain the market fundamentals can support additional exposure. Noting that the entire country has just 110,000 hotel rooms, about the same as New York City-based Choice Hospitality India CEO Vilas Pawar says the aim is to capture “the growing inbound, outbound and domestic travel sectors across the country,” with hotel demand outstripping supply in most areas. Choice Hotels India is a master franchisor of Choice Hotels International and already has hotels in 22 Indian cities, including Chennai, Lucknow, Nashik, New Delhi, Shimla, Trivandrum and Vijayawada.
Including the construction of 12,000 rooms, the Riric contract calls for Choice Hotels India to brand and manage upwards of 15,000 rooms in total, representing “an exponential increase in our existing room base,” says Pawar. “We are very pleased with this partnership and look forward to a mutually beneficial association.”
Riric, meanwhile, is proposing to construct six new metropolitan areas in India, among the more advanced being RGC Bangalore, a 3,000-acre sub-city to be developed near Bangalore International Airport. The $8.9-billion venture would have 146 million sf of commercial, industrial and residential space in a location 15 times the size of London’s landmark Canary Wharf. On the hospitality front, the company is completing Phase One of its inaugural Royal Garden Villas & Resorts project in Bangalore, with phases two and three to be hitting the markets in the second quarter. The resort-style complex will be launched throughout India during the next 18 months in Chennai, Delhi, Goa, Mumbai and Pune.