The investment platform will acquire fully operational hotels in the luxury, upper upscale and upscale segments in India, IHCL said in a filing to the BSE.
The equity contribution from IHCL will be at 30% and the balance will be contributed by GIC.
“As a long-term investor, we are confident in the outlook of India’s hospitality sector. We look forward to working closely with established partners such as IHCL to pursue attractive opportunities and capture the sector’s growth potential," said Kok Sun Lee, chief investment officer, GIC Real Estate, in a statement.
The acquisitions will be housed in a separate special purpose vehicle (SPV), but will be managed by IHCL. “Through this platform, we expect to acquire strategic and marquee assets that need new ownership, branding and positioning," Puneet Chhatwal, managing director and CEO, IHCL, said in the statement.
In February 2018, IHCL had outlined a development strategy “Aspiration 2022" to drive inventory growth and become South Asia’s most profitable hospitality company.
IHCL signed up 22 hotels in 2018-19 and added an inventory of over 3,200 rooms to its pipeline, via 18 management contracts and four operating leases, in India and key international markets, including London, Mecca, Kathmandu and Dubai, Chhatwal said in the firm’s latest earnings release.
The luxury hospitality space has seen increasing activity with several hotel brands planning to enter India and some mid-scale domestic and foreign brands venturing into the luxury space. For instance, French hospitality firm Accor Group will introduce its most expensive Raffles brand in India by signing up one property each in Udaipur and Jaipur.
Mandarin Oriental Hotel Group Ltd plans to enter India’s growing luxury hospitality market and is in talks with several property owners to set up its first luxury boutique hotel within the next year. Lemon Tree Hotels Ltd, a leading hotel chain in the mid-to-economy category, is diversifying into the upscale segment with the launch of a new brand this year.