Britain-based hotel major Hilton Hotels Corp is all set to form a joint venture with Indian realty giant DLF Ltd to take advantage of the boom in the country's hospitality industry, a top Hilton official said.
The global hotel chain plans an investment of $140 million in the new venture, in which DLF will hold a 74 per cent stake and the rest will be with Hilton.
"Tourism in India is expected to get a major boost thanks to the powerful combination of economics and demographics," said Ian Carter, executive vice president of Hilton and chief executive of its international operations.
"The Hilton DLF JV is a compelling next step to capitalise on the development momentum and build Hilton brands in India," Carter said in an interview.
Hilton is among the major players in the upper end hospitality segment globally and the joint venture with DLF will develop 75 hotels and serviced apartments over next seven years, subject to the necessary approvals, he said.
The venture will represent a bouquet of Hilton brands such as Hilton Hotels, the Hilton Garden Inn, Homewood Suites and Hilton Residences. While the venture will modernise and build these properties, Hilton will manage them, said Carter.
During the first phase, the joint venture will develop some 20 hotels in cities like Chennai, Chandigarh, and Kolkata — a larger number under the Hilton Garden Inns brand to offer focused service.
Later, the venture will identify and acquire sites to undertake new projects.
According to Carter, his group will also manage five more hotels that are under development — Hilton Bangalore, Hilton Residences at Embassy Gold Links Bangalore, Hilton Chennai, Hilton Hyderabad Palace and Shilim Retreat.
According to industry estimates, the size of the hospitality industry in India, given its growth prospects, continues to be abysmal with 26,000 rooms. Some 100,000-125,000 rooms are expected to be added over the next few years.
Hilton — which has more than 2,800 hotels and 495,000 rooms in some 80 countries — is keen on tapping this potential, Carter said.
DLF — which is a India's leading real estate developer, engaged in the business of developing office complexes, homes, shopping malls, special economic zones, hotels and infrastructure projects — will make the bulk of the investment.