InterContinental Hotels group (IHG), the world?s largest by number of rooms, plans to increase the number of its hotels by 20 in the country in the next 2-3 years. At present, IHG has 13 properties in India, 11 of which are franchisees and the rest two are managed by the group itself. ?We see India as a high growth market and would like to manage all our future properties ourselves,? said Jan Smits, COO, Southern Asia and Korea, IHG.
Out of the 11 hotels of IHG that are run on the franchise model, four are with the Grand group, the contract of which expires in January 2009. The company plans not to renew the contract after that. As far as its existing properties are concerned, the company will wait for the contracts to expire and will not immediately cancel them. ?Our other contracts will take a lot longer to expire. They will continue to function the way they are right now,? said Michael G Herrmann, director of operations, IHG.
The company operates hotels in India under three brand names ? Holiday Inn, Crowne Plaza and InterContinental Hotels and Resorts. Out of the 20 new hotels in the pipeline, 15 will be Holiday Inns, four under the Crowne Plazas segment and one will be under InterContinental. Smits said that Holiday Inn is the most lucrative brand to expand in India as land cost is an issue in the country.
The company has tie-ups with real-estate companies like Emaar, DLF, Today group and Eros. According to Rajiv Sharma, associate VP, development, South West Asia, more companies are looking at established hotel chains to manage their properties than do the task themselves. ?99% of people who approach us want us to manage their properties. Almost no one is looking at a franchise model now,? said Smits. ?The DLFs and the Emaars are least interested in hotel operations,? added Sharma.
The first of the 20 new hotels proposed will be launched by mid-2009 and will be a Holiday Inn. The company plans to launch a total of four hotel in 2009. Globally, IHG operates under seven brands. However, according to the company officials, it has no plans to bring other brands to the country. ?According to our research, food service works best in the country. Therefore, we want to expand our hotels in the existing categories which service to this market,? said Smits.
Globally, IHG currently has 4,046 hotels and has 1,788 new hotels in the pipeline. A chunk of them (745) are in the Holiday Inn Express segment, which is not present in India.
