The Hongkong and Shanghai Hotels Ltd, which operates luxury hotels under the 'Peninsula' brand, announced today that it is in talks with international parties for a partnership to enter the Indian market. "We have looked at several properties and held discussions in India to have a presence in the country," said Peter C Borer, Director and Chief Operating Officer of Hongkong and Shanghai Hotels Ltd.
The company is scouting for assets in India to start operations in Delhi and Mumbai. Unlike other international chains, it seeks to invest in properties as owners with a majority stake.
Senior company officials have been visiting India for the last four to five years to scout for potential partners, Borer mentioned, but did not disclose the specific parties with which the company has been having discussions.
When asked why the company has not made progress so far, Borer explained: "We are looking for the right partnership for the long term, and we want to go slow and steady in the market."
Borer did not comment on the timeline for opening its first property in India, nor on the possible investments to be made in the country.
Commenting on the company's business model, Borer stated: "Our philosophy worldwide is to invest in property and manage rather than only managing it." The Hong Kong-based hospitality chain currently operates nine hotels in Hong Kong, Tokyo, Beijing, Shanghai, Bangkok, Manila, New York, Chicago, and California with an average room count of about 200-300 per property. These properties are positioned as business and leisure destinations.
The company is currently developing its 10th property in Paris, which is likely to be operational by 2013. When asked about the room tariff of the chain, Borer said it varies from location to location but ranges between USD 150 to USD 900 per room per night. The average occupancy level across the chain is about up to 75 percent.
Commenting on the Indian market, Joseph W Y Chong, General Manager of The Peninsula Shanghai, said: "We are still learning about the real estate situation in India. We will not compromise on lower or cheaper substitutes and ideally, we will go for a location that is culturally connected and centrally located."