Langham Hotels Looks for Partners in India

Langham Hotels International, the operating and asset management arm of Hong Kong-based Great Eagle Holdings, has identified India as a strong market for development. Helmut Knipp, its senior VP (development) reveals, “Our focus has been on China of late. But India is as large and showing similar growth. The opportunity cannot be missed and we wish to take measured steps to establish the brand in India.”

According to the company, there is a strong interest to build the brands in Delhi NCR, Mumbai, Hyderabad, Bangalore, Chennai, Ahmedabad, Kochi and Goa. Knipp adds, “While on a trip to Pondicherry, I realised that the place is an ideal destination for our wish list - an undiscovered gem.”

The group is looking at management contract development in India for its two brands - The Langham (super luxury brand) and Langham Place (ideal for cities, mixed-use, or business hotels) - although it has not completely sidelined direct ownership. “In case we go for ownership, the investments will be accrued through debt and equity,” Knipp says.

According to him, there will be a focus on selecting the right partners for which he is currently speaking to developers. “We are open to partnerships with real estate developers or even Indian hotel companies for existing or greenfield properties. We will also try to facilitate funding for projects through our international networks,” Knipp elaborates.

The group aims to enter into a long-term contract of 25 years that can be renewed. Speaking about the fee structure, Knipp remarks, “We are going to be very competitive and at par with international standards. The group wants to offer value addition for the Indian developers and would expect developers to live up to the brand’s standards.

The Langham Hotels and Langham Place would have an average of 50 sq metre and 35 sq metre room sizes, respectively. While the former will be restricted to a maximum of 200 rooms, the latter would range from 100 to 400+ rooms properties depending on the plot. Raju Shahani, executive consultant with LHI, informed, “The estimated cost for the former will be approximately Rs 1.2 to 1.3 crore, while the latter would be from Rs 80 lakh to Rs one crore. These are estimated figures and would come down in case of real estate developers owing to their expertise in the field of construction.”

There is a plan to make Chuan Spa - a signature brand of LHI - a regular feature in its Indian properties. The group might add some specifically-designed spa rooms on the same floor. The group has forayed in China with a boutique hotel set to open in 2008 and recently opened a spa resort in Thailand. LHI has a development office in Bangalore at present and is looking to have its first sales office in Bangalore, Mumbai or Delhi that will help focus on India’s outbound market.