Chalet Hotels Expects Fresh Marriott Contracts, Renewals To Drive Revenue Growth
Chalet Hotels Ltd., an owner, developer and asset manager of high-end hotels in key metro cities of India, expects renewed contracts and fresh agreements to drive its revenue growth in the near term.
“We have signed around 1,500 room contracts with the Marriott Group where most of them are renewal of contracts that have run out,” Sanjay Sethi, managing director and chief executive officer, told BloombergQuint in an interview. “We also signed three new hotels as additional capacity in Hyderabad, and Airoli and Powai (in Maharashtra).”
Chalet Hotels, according to its investor presentation, has six properties in Mumbai, Hyderabad and Bengaluru. Its hotels are operated under brand names of JW Marriott, Westin, Marriott, Marriott Executive Apartments, Renaissance and Four Points by Sheraton.
The company’s deal with Marriott comes when the hospitality sector, according to Axis Capital, is emerging from a 10-year lull. Asset owners are witnessing an upcycle as they enjoy a larger share of incremental operating margin, it said in a report.
An asset owner, Sethi said, earns about Rs 40 lakh per room a year against Rs 2 lakh for a brand owner in terms of incentive fees in the luxury segment.
Chalet Hotels also expects the quarter ending March 2020 to be the “best” of the fiscal year on the back of foreign travelers and business tourists. “The key elections and nasty monsoon that set the first couple of quarters is behind us.”
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