Leela scion scripts plan for hotel chain launch3 min read . Updated: 06 Jul 2015, 12:59 AM IST
Amruda Nair's new venture Aiana Hotels & Resorts is scouting for properties in South India for the new hotel chain
Mumbai: Hospitality major Leela Hotel scion Amruda Nair’s new venture Aiana Hotels & Resorts is scouting for properties in South India as it plans to launch its first hotel chain in the country by early next year.
Aiana Hotels was formed early this year as a joint venture between Nair and Sheikh Faisal Bin Qassim Al Thani, chairman of Qatar-based asset management company Al Faisal Holding. It is currently in the process of developing its first flagship hotel in Doha which is expected to be operational by early next year.
The 32-year-old granddaughter of Captain Krishnan Nair, founder of the Leela Group of hotels, said the new venture will be completely independent and different in terms of its service and positioning from Leela Hotel, where she was earlier working as head of asset management.
While Leela Hotel operates in the super-luxury space, Aiana will be positioned in the mid-to-high-end segment with a mixed portfolio of boutique resorts and hotels targeting younger travellers.
Her move to branch out independently comes at a time when Leela Hotel is struggling to clear a debt of around ₹ 4,500 crore. As part of its corporate restructuring programme, the company has adopted an asset light strategy, where it is looking to operate mostly through management contracts with individual property owners. It is also in the process of selling off some of its properties in Chennai and Goa for which it invited expressions of interest in March this year.
Nair declined to comment on developments at Leela Hotel, saying her “energies are currently focused towards building Aiana Hotels & Resorts".
Aiana Hotels is in talks with single property owners in Kerala, Karnataka and Andhra Pradesh, and expects to sign management contract deals with a few of them in the next quarter. Some of the hotels are expected to become operational by early next year.
“We are focusing on South India as it offers a diversity of leisure experiences from mountain-top plantations to backwaters and beaches. We are in discussions for several greenfield projects in weekend destinations but will also look at conversions going forward," said Nair, who is joint managing director and chief executive officer at the company.
Locations identified by the company for its first hotel or resort in India include Munnar in Kerala, Coorg and Nandi Hills in Karnataka, and Amaravati and Vizag in Andhra Pradesh.
“Under the Aiana brand, we plan to have seven hotels either operational or under development in the Middle East, India and South East Asia over the next five years, all under management contracts," she added.
Industry experts said Nair’s earlier association with a legacy brand will help Aiana take off despite current challenges in the hospitality industry, especially in the luxury segment. At the end of last year, most luxury hotels had occupancy rates under 60%.
“These are challenging times for the hospitality industry. Anyone launching a new hotel at this time will have to face some headwinds. However, if you have the legacy of Leela, the patrons will notice it," said Bhavesh Gandhi, analyst at IIFL a brokerage firm.
Gandhi said Nair has a well-thought-out business plan, target group and branding idea, which should help her tide over the difficult times. “As the economy gets better and the hospitality industry gets into a comfort zone, she should reap the benefits," he added.
An ICRA report released last week said revenue growth for the Indian hotel industry is expected to remain weak at around 3-4% in the first half of 2015-16.
While room inventory in the country is expected to grow by 12%, occupancy is expected to improve by about 2-4% this financial year, the report said.