Leisure Hotels Group to expand its hostel segment brand

New Delhi: Leisure Hotels Group (LHG), a hospitality firm that owns 22 properties in 4 states, and entered the branded hostel house underneath Bedzzz two years in the past, is trying to expand its footprint within the class. The firm mentioned it’ll look to scale the hostel vertical with its second property in Varanasi. 

Bedzzz was first arrange in Rishikesh and is owned and managed by the corporate. The Varanasi property, nonetheless, will operate underneath a administration contract. “These properties have each rooms in addition to hostel-style particular person beds and lie within the funds to mid-market house and so it’s straightforward to get a return on funding inside a number of years,” mentioned Vibhas Prasad, director, Leisure Hotels Group.

The firm may also expand this brand in areas which have backpackers corresponding to non secular areas in addition to different leisure markets. “The beds mannequin is probably the most worthwhile of all our verticals as a result of it requires much less capital to be deployed and the return on funding is far earlier than different resorts. It is a mid-scale providing, sure, but it surely has dynamic pricing and that makes it fairly viable,” added Prasad.

Other than hostels, the group’s portfolio has business hotels, boutique resorts, bespoke villas and luxury camps. At present, the company owns 65% of its assets in the group. The company has about nine promoter companies among which these assets are divided.

The company plans to deploy upwards of 100 crore to build the next nine hotels expected to be ready by 2024. These will be projects across categories in the Uttarakhand and Himachal Pradesh regions. Currently, two of Leisure Hotels’ properties are managed by IHCL-owned Taj Hotels such as Pilibhit House in Haridwar.  In the past, for its owned hotels, the company has also partnered with The Claridges and Club Mahindra (Mahindra Holidays & Resort India Ltd) to run its properties. It also has a villa property, The Bungalows Light House in Goa. “We don’t have a mnemonic that we want to carry forward for our hotel management arm. So we are happy to take on properties from owners that want to keep their own names and brand equity,” Prasad mentioned.

In the posh segment, Prasad mentioned that its properties are getting a yield of 15,000-25,000, a room evening. “In spite of the covid waves, and being shut for nearly six months in 2020 and two months in 2021, on an mixture portfolio stage, we have been ready to get better our 2019 numbers and now we have now crushed these figures,” he said.

The company first launched its hotels in 1989 and has experiential luxury resorts in North India, several of them in Uttarakhand. “We began to build our resort chain largely on the back of the domestic Indian traveller. We found there was unutilised potential in the state of Uttarakhand and we had seen markets like Goa, Rajasthan and Kerala evolve on the global map. But we realised markets like Haryana, UP etc., were not very well known and started focusing on building hotels in these places,” Prasad mentioned.

Hospitality consultancy Hotelivate estimates that there are about 59,000 new rooms proposed throughout the nation within the subsequent 5 years. Of these, 72% or about 35,000 rooms are underneath lively improvement.

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