Claridges Hotels to tie up with Swiss investment co

The Economic Times dt.27/1/09

DELHI-based Claridges Hotels is about to enter into a long-term management contract with a Swiss investment firm which is foraying into the hospitality industry in India. The Swiss investment firm will build a chain of golf & polo spa resorts and has roped in the hotel chain as the management partner.
Under a management contract, the hotel operator charges a fee or has a revenue-sharing arrangement with the builder of the hotel. As per an executive close to the development: “The Switzerlandbased investment firm wants to bring in the concept of a golf resort into India. As polo is also played in India, the investment firm is combining both the sports to come up with the concept of golf polo spa resort.” The first of the resorts is expected to come up in Udaipur at an investment of Rs 60-70 crore, added the executive. The Udaipur property, which will be a pilot project, will have less than 100 rooms. When contacted, The Claridges Hotels CEO Peter Leitgeb refused to reveal any details on the new venture. The hotel chain currently operates three properties in North India. It will open another business hotel in Surajkund, near Delhi, in March with 100 rooms. In addition, the company will open its property in Mumbai by 2011. It is also acquiring land for building properties in Chennai and Hyderabad.
The management contract with the Swiss investment firm would be the first of its kind for the hotel company, which has, so far, built and managed hotels on its own.
The hospitality industry is currently witnessing dip in average revenue per room as well as in occupancies pan-India due to the economic slowdown. As per industry estimates, the hospitality industry has lost close to Rs 3,000 crore in 2008-09.