royal-orchid

Real estate company Parsvnath Developers said it expects three hotel properties — in Shirdi, Mohali and Lucknow — to become operational next fiscal. The company, which had already ‘scaled down’ its original plans, is going slow on its hospitality blueprint. The current focus, it claims, is to finish 80 million sq ft of space that it is developing across 52 projects, mostly residential. “We are not going aggressive on hospitality…few of the properties are under construction, and for the rest the process of approval and sanction has not started. We are going slow because our major focus is on execution of 80 million sq ft,” Parsvnath chairman, Pradeep Jain told Business Line. Parsvnath has roped in ITC to manage the three hotels that will come up next fiscal. The three properties have a combined capacity of over 260 rooms. While Mohali will be a 5-star hotel, Lucknow and Shirdi are 4-star and 3-star properties respectively. The three properties are under various stages of construction, he said, adding that the company anticipates a strong demand in the three locations given the shortage of hotel rooms. At the height of the property boom, Parsvnath had outlined a bold hospitality strategy and had tied up with two hotel chains, Fortune Park Hotels Ltd (a subsidiary of ITC) and Royal Orchid Hotels, to manage and operate its proposed properties. As per the company’s Web site, ITC’s FPHL was to manage and operate 50 hotels developed by Parsvnath Hotels Ltd, the hospitality arm. Three years and a downturn later, the company has reset its expectations for hospitality space although Jain is reluctant to term it a ‘scale down’. “When we were in aggressive mode, we were thinking of 50 hotel properties. But now are looking at 15 — all of these are part of integrated township or mixed development. The figure of 50 (hotels) was only a plan….We had said from 15 we will go to 50…but we are not acquiring land aggressively,” he said. Moreover, the hospitality special purpose vehicle (SPV) with Royal Orchid Hotels is still operational but there has been no acquisition of land under it. “We formed an SPV with Royal Orchid Hotels to acquire some hotel property. But after the global slowdown both partners decided not to acquire any property… We formed the SPV with a small capital and only if we had acquired (land for hotels) we would have had to invest. However, we do not want to disturb the SPV, for now, and if a good opportunity comes our way, we may go ahead,” he said.