"The group would add an inventory of 1,700 rooms in the 11 new hotels to take the total room strength to 2,500 from the existing 800 rooms," Lemon Tree Hotels Chairman and MD Patu Keswani said.
"The Current economic turmoil and ongoing slowdown of the Indian economy is short term in nature. Reduction in demand for hotel rooms is therefore fundamentally temporary. Demand for rooms will rebound by 2010. At the same time, new supply of hotel rooms will be significantly below that which was envisaged just 6 months earlier due to this deflation in demand and the tight liquidity conditions in the market," said Keswani in a release.
After the recessionary bells started ringing, the hotels have generally maintained a low profile with realtors postponing or cancelling almost all the new projects.
The company plans to invest Rs. 12 billion in 15 major cities in India, including South Delhi, Gurgaon, East Delhi, Pune, Goa, Alleppey, Indore, Aurangabad, Mumbai, Bengaluru, Hyderabad, Chennai, Jaipur, Chandigarh, Shimla and Ahmedabad
It has opened three new hotels at Ahmedabad, Aurangabad and Indore with a total inventory of 300 rooms since October, 2008. with an investment to the tune of Rs 830 million. It already had two hotels in Gurgaon, one in East Delhi, a resort each in Goa and Kerala and a hotel in Pune.
It will open its first Red Fox brand of economy hotels in Jaipur in October 2009 to be followed up with properties in Delhi in December 2009, and Hyderabad in April 2010.
Lemon Tree was one of the four bidders for the Delhi International Airport (DIAL) project, involving commercial development of 12 plots spread across 45 acres of land , including nine for hotels around the Delhi airport. Big real estate and hotel companies have not participated due to low business sentiment. US-based real estate investment fund Starwood Capital, which has invested in some hotel projects in the country, is the lone financial investor to have participated in the auction.
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