Will The Ashok regain its sheen under a new owner?

Iconic hotel’s sale may attract phenomenal interest from bidders

Will The Ashok regain its sheen under a new owner?
Allowing for refurbishing of the hotel and development of serviced apartments alongside, plus coming up of retail and commercial space within the complex is likely to make the property a prime hub in the heart of the capital, and the hotel a crown jewel again.

When it opened in 1956, The Ashok, then known as Ashoka Hotel, was the fanciest hotel in the national capital, with an imposing facade in a prime location. It played host to not only world leaders but Delhi’s cool crowd, too, with one of the city’s first nightclubs and exotic restaurants serving French and Japanese cuisine.

From stories of Nehru coming on horseback to supervise its construction to a struggling Dhirubhai Ambani storing his luggage with a staffer while he made rounds of ministries, the hotel is literally the stuff of legends, its corridors witness to guests like rebel Che Guevara, Cuban president Fidel Castro, LTTE leader Prabhakaran and even terrorist Maulana Masood Azhar.

Over the years, as other private five-star hotels opened their doors in Delhi, The Ashok gradually lost its sheen, largely due to the sarkari tag. Attempts made about a decade back to sell the hotel had to be shelved due to labour issues, and the establishment’s past contracts. Now with the Centre, which holds a 87% stake in the hotel’s parent company ITDC, firming up its disinvestment plans, the iconic property is up for grabs along with two adjacent land parcels of 6.3 acre and 1.8 acre each. As per sources, the property could fetch the government around Rs 7,500 crore.

Also Read| ITDC to hold road-show for monetisation of Ashok Hotel on Monday

Allowing for refurbishing of the hotel and development of serviced apartments alongside, plus coming up of retail and commercial space within the complex is likely to make the property a prime hub in the heart of the capital, and the hotel a crown jewel again.

While details of the divestment will be finalised after a roadshow planned by India Tourism Development Corporation (ITDC) on Monday, reportedly major hospitality players Indian Hotels Company Limited (IHCL) and ITC have already evinced interest, besides players like the DS Group.

Industry insiders like KB Kachru, vice-president of Hotel Association of India and chairman emeritus and principal adviser, south Asia, Radisson Hotel Group, expect the interest to be ‘phenomenal’, with not only major hospitality brands but real estate and foreign companies also vying for the prime property. Considering that one can’t go wrong with the property’s location and lease model that will ensure a good return on investment, Ajay Bakaya, managing director of Sarovar Hotels and Resorts, expects at least three-six serious contenders that could also include American companies – the ‘big boys’ – as he puts it.

Believing that a mixed use commercial development with hospitality and retail uses will make good financial sense for the project as well as for the prospective investor, Jaideep Dang, MD, hotels & hospitality group, India, JLL, said, “It is among the best locations in the country and deserves world-class development. And, today we have credible Indian conglomerates, including top-tier real estate developers, private equity funds and hospitality companies, who could participate in the process.”

Pointing out that the government should be flexible regarding the project and not impose conditions like retaining the original facade of the hotel, which, he said, will just suppress valuation, Manav Thadani, founder and chairman of consulting firm Hotelivate, said he expected players from the south like Embassy and Prestige group or even from Mumbai and Bengaluru to bid for the project, seeking a foothold in the north.

Pradeep Shetty, joint honourary secretary of the Federation of Hotel & Restaurant Associations of India, said he expected several hotel companies to bid for the project, which, he believed would be a great addition to the tourism landscape of the city.

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