The 300-room hotel project located next to Mumbai's Chhatrapati Shivaji International Airport property was earlier part of service apartment brand Oakwood Worldwide
New Delhi/Mumbai: Masa Hotels Pvt. Ltd, a unit of Mozambique based Masa group, has agreed to buy a 300-room hotel project located next to Mumbai’s Chhatrapati Shivaji International Airport from Aristo Realty Developers Ltd.
“We will invest $50 million on the asset purchase and project completion," Sabir Rassul, director, Masa Hotels India, said in a phone interview. Masa Hotels owns and operates five hotels in Africa and Europe, he added.
“It will be a completely Shariah-compliant (meets requirements of Shariah law) hotel and among the few in the region" he said. “We plan to build and acquire more such properties in India, especially in key metro cities which receive a large number of visitors from the Middle East."
The hotel property was earlier part of global service apartment brand Oakwood Worldwide. Aristo Realty decided to put the hotel on the block and had been looking for a buyer, Mint learnt from people aware of the development.
According to Rassul, the project will compete directly with larger hospitality brands in the vicinity which include JW Marriott, ITC Maratha, Hyatt Regency, Leela, Lalit and Hilton Hotels, among others.
There is an acute mismatch between demand and supply when it comes to quality of accommodation in India, when compared with other key global markets," said Nandivardhan Jain, managing director and CEO, Noesis Capital Advisors, which acted as the sole adviser on the transaction.
“Key reasons for limited supply are high cost of debt; limited banks sanction of loans for hotel projects, shorter repayment cycles " Jain added.
In the current scenario foreign direct investment in hospitality industry is a great alternative for Indian hospitality industry from a capital raising perspective," Jain said.
Mumbai-based Aristo Realty has completed 1.3 million sq. ft. of development of residential and commercial projects and has ongoing projects of over 1 million sq. ft. This was the company foray into hospitality sector.
Aristo realty did not respond to requests for a comment on the story.