Race hots up for the 14 sites being offered by Ircon; Tata hotels may also bid.
Hospitality companies including Tune Hotels, owned by AirAsia promoter Tony Fernatndes (pictured), are in the race for setting up hotels at 14 semi-developed sites near key railway stations across the country.
Ircon International, a company under Railways, is offering multi-functional complexes (MFCs) that feature hotel rooms, designatted space for food and beverage and operations facilities at key railway stations across India.
The total guest room inventory across these hotels is expected to be over 600.
Tune Hotels India Services (THIS) operates as a 60:40 joint venture between Tune Hotels and Mumbai-based Apodis Hotels and Resorts Ltd. While Apodis holds the master franchise for Tune-branded hotels in India, the management of these properties will be handled by THIS, which will also look after technical and development services and project management consultancy.
Apodis Hospitality Group, which also owns and operates bed-and-breakfast hotel chain Mango Suites along with Cafe XO restaurants, confirmed it is in the bidding participation.
Umesh Luthria, executive director and CEO, Apodis Hospitality Group, said the company is working on the tender document. “We are looking into the legalities of the tender document while simultaneously assessing the market demand. If it is an over 100-room hotel, then we will go with Tune brand and if the location has a smaller inventory of 50-70 guestrooms, then it will be Mango Suites,” he said.
The 14 sites are in Jammu, Allahabad, Haridwar, Udaipur, Jodhpur, Gwalior, Indore, Jabalpur, Raipur, Digha, Siliguri, Hubli, Madurai and Kannur.
With railways offering hotel developments on their land parcels, industry experts said a huge opportunity awaits the hotel chains operating in India.
The projects are located in close proximity to railway stations and some of the sites even have space for meeting rooms, banquet halls, food courts, supermarkets, shops for pharmacies and ATMs.
Shreenath Shastry, national director-hospitality and leisure, Knight Frank (India), the company which is handling the bidding process, said, “The organised segment will see value in the sites on offer because of prominent locations, clear title developments and ready markets.”
Sanjay Sethi, MD & CEO of Berggruen Hotels, said, “It will give an opportunity to a lot of new, improved, competitive and quality products to address the market. I’ll be very keen to explore this opportunity. While not all sites will be viable, at least 20-30% of the locations on offer would certainly make for ideal locations,” he said. Berggruen is in the process of creating a separate brand to tap the ever-growing budget and economy travellers, he said.
Industry sources said the 14 sites are only the first tranche. In all, there are over 100 developments in various stages of planning and development.
Tata Group’s Ginger, Accor’s Formule 1 and Lemon Tree’s Red Fox are the other major players in the budget hotel segment, and are likely to participate in the bidding process as well.
The final date for submission of the bids is September 5 and the technical bids will be opened the next day.
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