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Best Western International is planning
to roll out 100 hotels in India to join the race to
capitalise on the country's chronic shortage of tourist
and business travel accommodation, reports FT.com.
Best Western's licensee, Cabana Hotel
Management, will invest more than $1.2bn in the initiative
over the next 10 years, which will look to develop the
mid-tier four-star market, a segment that is almost
non-existent in India today.
"We decided that India is going
to become a very important country for Best Western
in terms of inbound and outbound tourism," said
David Kong, chief executive of Best Western.
Best Western is world's largest chain of hotels.
With foreign investors flooding into the
country, hotel rooms in India are routinely in such
short supply that luxury hotels often charge $300-$400
a night for rooms that just a few years ago would have
cost half or even a third of that.
In some mid-tier cities, such as Bangalore
, rates for five-star hotels can rise to as much as
$800 a night excluding tax when the city hosts a major
event.
The country has about 110,000 rooms in
the organised hotel sector. Analysts said this was as
little as half what the market needed and a fraction
of what was available in developed countries. The US
city of Las Vegas alone boasts 150,000 hotel rooms.
Mr. Kong said Best Western already had
six hotels in India but had decided to expand its offering
in a bid to target not only travelers within the subcontinent
but also the rising number of Indians traveling abroad
for business and holidays.
The idea is to promote the brand in India
's domestic market in anticipation that, as the country's
middle class prospers, they would follow the example
of their peers in China and become a major source of
outbound tourism in the decades to come.
Indians familiar with the Best Western
name in their home market would be more inclined to
stay at the chain when they went abroad, he said. More
than 6m Indians made overseas trips in 2005, according
to Euromonitor – roughly twice the number of incoming
visitors to India, half of which are business travelers.
Best Western will roll out the initiative
through Signet Hotels, a subsidiary of its partner Cabana
Hotel Management. The plan was to open 10,000 rooms
across India, which will be priced at 20 per cent to
30 per cent below rates at five-star hotels.
Signet would also consider the possibility
of sub-licensing the brand to other companies.
The hotel group's push follows plans by French hotel
group Accor and Dubai-based developer Emaar Properties
announcing last November to develop jointly 100 budget
hotels in India.
Hyatt International Hotels plans to open
15 deluxe hotels in the next few years and Starwood,
owner of the Sheraton brand, is aiming for 50 hotels
by 2010.
Mr. Kong said that to help deal with a
shortage of trained workers, Best Western and Cabana
Hotel Management would also begin work on a hospitality
institute in India this month to train future staff.
Source: http://www.ft.com
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