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Overview of the Indian Hotel Market

India's hotel industry is witnessing significant growth, driven by rising domestic and international tourism, increasing business travel, and a strong economy. The market size of the hotel industry in India is expected to grow at a CAGR of 13.6% during the forecast period of 2024-2029, reflecting the expanding opportunities for investment and development in this sector

Key Trends in Hotel Investments

  1. Investment Surge: Hotel investments in India reached USD 401 million in 2023, nearly quadrupling from the previous year. This surge was marked by 22 deals, the highest number of assets traded in the last decade, indicating strong investor confidence.
  2. Types of Properties:
    • Upper Upscale Segment: This segment saw the highest number of transactions, followed by upscale, luxury, and midscale segments.
    • Mixed-Use Developments: Hotels located within mixed-use developments and growth corridors near key infrastructure are becoming increasingly attractive to investors.
  3. Investor Profile:
    • Institutional Capital and HNIs: These groups accounted for 31% of investments, followed closely by real estate developers (27%). This diverse investment base underscores the appeal of the hotel sector to various investor types.
  4. Growth in Greenfield Projects: The number of greenfield projects grew significantly, reflecting sustained developer confidence in the long-term growth of the sector. In 2023, approximately 13,600 keys were signed in new projects, surpassing the 8,000 keys signed in 2022.

How We Can Help You Expand Your Hotel Business:

Expand into Upper Upscale and Luxury Segments: With the growing demand for upper upscale and luxury properties, our agency is well-equipped to guide you in expanding into these high-potential segments. We specialize in identifying prime opportunities in Tier 1 and high-growth Tier 2 cities, where resilience and profitability have consistently attracted significant investor interest.

Unlock Opportunities in Emerging Markets and Tier 2 Cities: Our in-depth market research reveals that 54% of hotel signings in 2023 occurred in Tier 2 cities, indicating vast potential for expansion. We can help you tap into these rapidly growing regions, where urbanization and rising disposable incomes create attractive environments for new developments.

Leverage Greenfield Projects for Long-Term Gains: Greenfield developments are on the rise, reflecting strong market confidence. We assist in identifying and investing in greenfield projects, especially in strategic locations near key infrastructure and mixed-use developments, to help you achieve substantial long-term returns.

Optimize with Lease/Revenue Share Models: Lease and revenue share models are becoming increasingly popular, particularly in Tier 1 cities. Our agency can guide you in adopting these models to reduce upfront costs and risks, offering a flexible approach to your expansion strategy that benefits both developers and investors.

Capitalize on Mixed-Use Developments: Hotels within mixed-use developments and growth corridors near key infrastructure offer diversified revenue streams and increased property value. We provide expert advice on how to maximize these opportunities, helping you stay ahead in the competitive market.

Advance with Sustainability and Innovation: Sustainability is no longer just an option—it’s a necessity. We help you develop eco-friendly and energy-efficient properties by integrating green building practices and smart technologies, enhancing the appeal of your investments to environmentally conscious clients and guests.

Forge Strategic Partnerships: Navigating new markets and segments is easier with the right partners. We assist in forming strategic partnerships with local developers, investors, and international hotel chains, providing you with the capital, market knowledge, and brand recognition needed to expand successfully.

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