Marriott plans India expansion – 50 more hotels over 4 years
Marriott International, the world’s largest luxury hotelier, has announced that it will be expanding its presence in India, adding more-than 50 hotels in the next three to four years. The group already has a significant presence in the country, but its commitment to add more reflects India’s enormous growth potential over the coming decade.
Marriott International’s share price has appreciated by 22% so far this year
Source: Yahoo Finance
Craig S. Smith, the company’s president and managing director in Asia Pacific, said: “We have about 50 hotels in the pipeline but will probably open even more than that. Smith added that Marriott already has a strong presence in the country, operating 116 hotels with 32,000 rooms. That makes it number four in the list of highest number of Marriott hotels in a single country – number two if you restrict that list to Asia alone. Around 80% of Marriott’s business in India is through domestic tourists. Smith said: “India is like 15 countries in one and has a lot to offer.”
Marriott’s “asset lite” business model (which it committed to a few years ago) sees it lease real estate in which to operate its fifteen brands. In India, that has a particular attraction, as setting up a new hotel often has challenges with high cost of land and capital, as well as slow permit processes. As a result, around 30% of the group’s expansion thus far has been through conversion and rebranding of existing properties. Smith explains: “So it becomes a very compelling argument to buy a distressed hotel, renovate it and put a name on it and see the hotel uplift.”
Dominion holds Marriott International in its Global Trends Luxury Fund.
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