Bengaluru sees ₹485 crore in hotel asset sales in a single day

Samhi Hotels Ltd has acquired a 142-room, 4-star hotel in Bengaluru’s Whitefield area for ₹205 crore, marking a strategic push to strengthen its foothold in one of India’s most lucrative hospitality markets. Formerly managed by ITC under the Fortune brand, the property, now called Trinity Hotel, will become part of Samhi’s portfolio following the acquisition of Innmar Tourism and Hotels Private Ltd.

The deal, funded through internal accruals, aligns with Samhi’s strategy of investing efficiently by acquiring existing assets at lower replacement costs rather than building new hotels from scratch, the company said in a statement to the BSE.

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Samhi plans to further expand the property by adding 200-220 rooms in a separate building, rebranding it from upscale to upper-upscale. Once completed, the total room count will rise to between 340 and 360, featuring additional food and beverage outlets, banqueting, and meeting facilities. 

"We think the revenue per available room (RevPAR) can be materially improved once the renovation and new supply will be added," noted Ashish Jakhanwala, chairman, managing director, and chief executive, Samhi. 

While Jakhanwala did not offer a comment on the potential investment this could draw, industry estimates suggest that the cost of this redevelopment could range from ₹200-250 crore, based on typical upper-upscale hotel room construction costs.

While Jakhanwala did not disclose the expected investment, industry estimates suggest redevelopment costs could range from ₹200-250 crore based on typical upper-upscale hotel room construction expenses.

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Samhi’s focus on Bengaluru, a city that adds 10-12 million square feet of office space annually, aligns with its long-term growth strategy. Jakhanwala emphasized the strong demand growth in the region, driven by limited supply, making it one of India’s strongest hotel markets. With six existing business hotels in the city, Samhi is well-positioned to tap into Bengaluru's booming office market.

Juniper and Lulu Group deal

In a separate transaction, listed player Juniper Hotels secured a ₹280 crore deal to buy a 220-room, five-star hotel near Bengaluru airport from Lulu Group’s Twenty Fourteen Hotels India Pvt. Ltd. The hotel, currently in a shell stage, spans 6.5 acres and is expected to undergo renovation and rebranding under an international hospitality brand. 

This deal, initially reported by Mint, highlights the increasing interest in Bengaluru’s hospitality assets, as Lulu Group initially sought approximately ₹2 crore per room with an expected valuation of ₹400 crore for the asset.

Mint had reached out to Juniper but queries went unanswered.

The Indian hospitality sector is witnessing a notable surge in transaction activity, with projected deal volumes expected to hit $413 million by year-end, marking a 22% growth compared to last year, according to JLL's hospitality division. Branded hotel signings in the first half of 2024 accounted for 19,442 rooms, with 6,071 branded rooms opening across the country.

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Samhi’s acquisition and expansion plans, along with Juniper’s deal, reflect the broader momentum in the industry as hotel operators and investors position themselves to benefit from India’s growing demand for premium hospitality experiences.