India’s Hotel Boom Expands to Untapped Markets

Skift reported in the last year that India’s hospitality boom was being fueled by a booming economy. driven by smaller cities. Now, the industry is expanding even further. 

This week, IHG Hotels & Resorts signed A Holiday Inn Express hotel is being built in Hapur, Uttar Pradesh. This city has no branded hotels. It’s expected to open by 2027, with 120 rooms. 

Sudeep JAIN, IHG’s managing director of Southwest Asia, said: “With its proximity to National Highway 9 (NH9) and connectivity to key hubs for business, the hotel is well positioned for both leisure and business travelers.” 

Sarovar Hotels in India is also expanding its portfolio to take advantage of India’s growing highway network. Sarovar Hotels Chairman Ajay Bakaya stated that highway hotels and resort concept properties near cities, within a three to four hour journey, are new high growth segments for hospitality.

New Investment Hotspots

Most major Indian hotel chains have already added cities like Amritsar and Udaipur to their portfolios. 

Siliguri, Gangtok and Barnala are among the new destinations, as well as scenic locations such as Daman & Diu and Lakshadweep. 

This month has been a busy one for us. Lemon Tree Hotels signed a hotel in Siliguri Keys Select by Lemon Tree Hotels is a brand of Lemon Tree Hotels. Hilton opened its first DoubleTree Hotel in Siliguri last month. 

Hilton announced this in a press release: “Siliguri is located at the convergence of four international border crossings – India Nepal Bhutan and Bangladesh. It’s an emerging hub for tourism, business and trade.” The city has gained prominence for being a gateway destination to popular destinations, such as Darjeeling Kalimpong and Sikkim.

The hospitality industry is also looking at industrial hubs in the interior. In September last year, the parent company of Taj Hotels Company Indian Hotels Company announced a new agreement. Gateway hotel in Barnala in Punjab. This signing is consistent with our strategy for growing IHCL’s footprint in Tier II cities and III in India. Barnala is a commercial-industrial centre that borders Ludhiana and is an emerging market for Punjab, said Suma Venkatesh. 

The company has also signed an agreement to build a Gateway Resort in Kandla, a “important” industrial city and port in Gujarat. 

There are also new leisure destinations. IHCL has properties in previously unexplored destinations like Chail in Himachal Pradesh and Diu in Lakshadweep. 

Untapped potential is also reached by the expansion. religious tourism destinations. Last year Accor signed an agreement to build a Novotel Hotel in Guruvayur City. The company’s sights are set on Tier 3 Cities. We are very excited to explore Tier 3 cities in India, as this is a growing market. Garth Simmons (chief operating officer of Accor Asia) said in a press release held in February that India will be a major player for Asia over the next 10-30 year period. 

IHG has brought its new midscale conversion brand Garner In India, two lesser-known hotels have been signed: Etawah (Uttar Pradesh) and Kathua (Jammu and Kashmir). 

Lesser Inventory, Event Spaces

The properties are very limited in number, despite the fact that hotels are investing in these unknown cities. There are dedicated events facilities in each hotel.

• IHG Garner Etawah’s 40-key hotel will feature a large ballroom that can accommodate small weddings and social events. It also has meeting rooms. 
• The Garner Kathua, a 45-key hotel, will feature “versatile event spaces” that can be used for business meetings, parties, and leisure stays. 
• DoubleTree Hilton Siliguri has 120 rooms and 17,000 square feet for events. 
• Gateway Kandla will have 93 guest rooms and a banqueting area of more than 19,000 square feet. This space is ideal for large social events, corporate gatherings, destination weddings, etc. 
• The Gateway Barnala’s 100 rooms will include a banquet area of 7,000 square feet and meeting rooms. 

The demand for hotels is real in smaller, less-known suburbs. It is due to the increasing consumer and trade patterns. Consumption of food and beverage and banqueting have gone through the roof,” Jaideep Dang, managing director, Hotels & Hospitality Group at JLL, told Skift. He said that in these cities a large banqueting area will be attached to a limited room inventory because the local population will also be interested in banqueting.