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.
If you would you like to receive the Newsfeeds daily, please click here to sign up now!Help us make this Newsfeed better by rating this article. 1 star = Poor and 5 stars = Excellent
The views expressed in this article are those of the author at the date of publication and not necessarily those of Dominion Fund Management Limited. The content of this article is not intended as investment advice and will not be updated after publication. Images, video, quotations from literature and any such material which may be subject to copyright is reproduced in whole or in part in this article on the basis of Fair use as applied to news reporting and journalistic comment on events.