Mandarin Oriental in talks to enter India's luxury hotel sector again

Mandarin Oriental is in talks with several property owners in India to set up its first luxury boutique hotel within the next one year, says vice-president (development) Alexandra Yao

Mumbai: London Stock Exchange-listed Mandarin Oriental Hotel Group Ltd plans to enter India’s growing luxury hospitality market, said a top company executive.

The Hong Kong-based firm, also listed on the Singapore Exchange, is in talks with several property owners in India to set up its first luxury boutique hotel within the next one year, said Alexandra Yao, vice-president, development, Mandarin Oriental.

Mumbai, Delhi and Goa are the key entry markets, she said, adding palaces in Rajasthan are some of the properties that Mandarin Oriental would consider.

“We have some potential partners that we are speaking with. It’s something that we are putting a lot of effort into. For Mandarin, it is important to find the right location and the right partners. Our absence in the past was because we needed to find those two factors. In the last few years, India has been on top of our list," Yao added.

About a decade ago, Mandarin Oriental signed an agreement with real estate firm Maker group to set up its first hotel in India at Mumbai’s Bandra Kurla Complex (BKC), said one person aware of the matter, requesting anonymity. However, the deal fell through as the project was delayed, he added.

A 4 May 2011, report by The Economic Times said Mandarin Oriental was in talks with Oberoi Realty Ltd to manage the Mumbai-based firm’s second hotel in the city.

Yao said the company will adopt an asset light model in India, signing management contracts with property owners instead of owning the hotels.

“This is the model we will be following globally, going forward. It’s easier to expand our footprint. There is high entry barrier in owning properties in a lot of countries where we want to be in," she said.

At present, Mandarin Oriental has 32 luxury hotels across Beijing, Singapore, Miami, London, Paris, Boston and Barcelona, among other places. About half of the hotels are owned by Mandarin, while the rest are joint venture partnerships, Yao said.

The changing lifestyle and growing consumer spending power in India have prompted the hotel brand to enter this hospitality market.

“In the last few years, foreign tourists are finding it easier to travel to India with the introduction of e-visa. It has also become a lot easier for leisure travellers," she added.