NEW DELHI: The French hospitality major, Accor, and the real estate developer, Emaar MGF, have entered into a joint venture for setting up 100 budget hotels in India at an investment of $300 million.

With the signing of this joint venture here on Monday, Accor became the largest international investor in the Indian hotel sector by launching its Formule 1 brand of budget hotels.

Addressing a press conference here, the Chief Executive Officer (Asia Pacific), Accor, David Baffsky, said the 50:50 joint venture, "Budget Hotels India Private Limited,'' would initially set up 50 hotels over the next five years largely in the top seven metropolitan cities.

The company had already identified potential locations across the country for the development of Formule 1 hotels.

The total development would add 10,000 hotel rooms that catered for the budget travellers. The agreement to set up the joint venture was signed in the presence of Emaar Properties chairman Mohamed Ali Alabbar and Accor SA Chief Executive Officer Gilles Pelisson.

Key growth market

"India is a key growth market for Emaar and we have committed one billion dollars — the country's largest ever foreign direct investment in the real estate sector — to develop several major projects across the country,'' Mr. Alabbar said.

He said that along with residential communities and special economic zones, the company regarded the hospitality sector as integral in its India growth strategy.

The Emaar chief is now the Director General of the Department of Economic Development in Dubai as well as a member of Dubai's Executive Council. In this country the Dubai-based Emaar has tied up with MGF Developments in the real estate sector.

Company officials told newspersons here that the hotels were expected to have about 100 rooms each and would serve local cuisine with the room tariffs expected to be in the range of Rs. 1,000 to Rs. 1,500.

As for job generation, they said the employment would be significant during the construction phase, but each hotel would require only about 20 employees for actual operations.

The Emaar Managing Director, Shravan Gupta, said Emaar MGF had plans to construct 10 to 15 luxury hotels for which land had been acquired. As for Emaar, it had already teamed up with Giorgio Armani to build and manage Armani hotels and resorts around the world, with Mr. Alabbar indicating that a proposal is being considered for one in Mumbai as well.

Printer friendly page  
Send this article to Friends by E-Mail