17.8.08

Hospitality Update

EIH Ltd, the flagship company of the Oberoi group, plans to invest Rs 650 crore on two new hotels in Bangalore and Goa. The two properties are part of its expansion gambit to set up 10 hotels and add 2,300 rooms in India and abroad over the next three-and-half years. PRS Oberoi, chairman of EIH Ltd, said the promoters were considering increasing their holding in the company from 46.34% currently. “The promoters’ holding would have gone up by 5% this year itself if we had enough funds,” he said.Oberoi, who was addressing a press conference after the company’s 58th annual general meeting , said EIH had never invested in another company as a matter of principle. “It is always good to increase our shareholding slowly, he said.He also said all their existing Trident properties would be consolidated under EIH Associated Hotels. He said the 436-room Trident property at Bandra Kurla in Mumbai was nearing completion and would be operational from January next year.EIH is also considering taking the five-star Trident brand overseas and West Asia could be the first overseas location, Oberoi said. “Management contracts will be the preferred overseas expansion route for Trident,” he said. Currently, there are nine Trident hotels and four more are coming up at Mumbai (Bandra Kurla), Chandigarh (300 rooms), Hyderabad (220 rooms) and Dehra Dun. He said seven out of their planned 10 new hotels would be managed by the company. The new properties would include the 220-room Oberoi Gurgaon, Oberoi Hyderabad and four Trident hotels. Out of it’s total planned outlay of Rs 650 crore, the company plans to invest Rs 500 crore on the Trident property in Bangalore. It has entered into a joint venture with Larsen & Toubro for the property, which is coming up near the new Bangalore international airport. L&T has 74% stake in the JV and EIH holds 26%.The rest of the amount would be invested on a 75-room property at Goa, which would have a hotel and villas and will be spread over 50 acres. The funding for these hotels will be through a mix of debt and equity in the ratio of 2:1, respectively.The company’s overseas projects include Oberoi Dubai, Al Raha and Al Yas Island Resort in Abu Dhabi, The Oberoi at Muscat and a resort at Marrakesh, which would have 100 rooms and 40 villas (that could be sold or given out on a long-term lease).EIH is also planning to add four new flight kitchens at Mauritius, Kolkata, Kochi and Kozhikode in addition to its existing ones in Kolkata, Mumbai and Chennai. Of these, the Kochi and Kozhikode kitchens will be managed by EIH.
Taj Hotels is giving final touches to its $100 million makeover of The Pierre in Manhattan, which would transform the property into one of the most elite landmarks in New York once the renovation comes through by early next year. The Tata group-promoted Taj Hotels, which is funding the facelift, is likely to recoup costs by charging $1,000 a night for its sumptuous rooms. New York’s top 5-10 hotels command $800 to $900 per night. The Pierre will occupy the pinnacle of the high-end market. The price of an average Manhattan room is a modest $300. Several dowager landmark hotels such the Hilton-owned Waldorf-Astoria and St Regis Hotel have plotted their future by investing from $15-22 million in their properties to appeal to a younger generation, who mostly look at these properties as stuffy relics. But the most dramatic changes are underway at the cream-painted Pierre, which the New Yorker magazine described as a “millionaires’ Elysium.” The renovations have been in the works since 2005. Babs Harrison, spokeswoman of the hotel said that large parts of the hotel have already been renovated. “The first phase of the renovation, including the function rooms, the Grand Ballroom, the Cotillion room and the foyer, were completed in January 2007,” she said. “What they are doing is a very sensitive restoration of the entire hotel. They are very cautious, moving slowly to do it correctly. While they are upgrading everything from technology to soft goods, they also want to maintain the core essence of the hotel as they know that the property is New York’s grande dame,” she said.The changing lifestyle of their clientele is also driving many of the changes at The Pierre. Well-heeled guests now have enormous bathrooms in their own homes and expect the same comfort on the road. The Pierre has actually cut down on its inventory of 200 rooms to re-use space to enlarge bathrooms. The recreated bathrooms will have Italian polished marble flooring, new countertops, fixtures and lighting.“Bathrooms have become these large chambers where people can play badminton,” Curtis Gathje, author of At the Plaza, said.The Pierre has been synonymous with European elegance ever since hotelier Charles Pierre Casalasco created a grand French ch√Ęteau on Fifth Avenue. During the Depression, The Pierre fell on hard times and was bought out by Standard Oil’s John Paul Getty, who sold many of the rooms as co-operatives to Hollywood stars such as Elizabeth Taylor and Cary Grant.Now owned by the residents of the 70 co-ops in the building, The Pierre put the Taj at the helm in July 2005 by booting out Four Seasons, which had been managing it for 25 years. Taj Hotels made a $35 million commitment to make improvements, but increased the budget to $100 million as renovations spilled over the last three years.Taj appears unperturbed by the cost and time the renovations have taken.“The Taj is no stranger to leasing hotels. They have set very good examples with the palaces in India, where these are owned by private families. The maharaja families, at times, were still living in parts of these residences while Taj was renovating the places. They know how to make it work,” Harrison said. The Pierre’s refurbished banquet facilities will remain open while the estimated re-opening for the guest rooms is in early 2009.

No comments: