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Accor bets on asset-light growth across brands

Aim is a 25% growth in its inventory of around 9,000 rooms over the next 5 years

By A Staff Reporter in Calcutta
  • Published 12.01.19, 1:04 AM
  • Updated 12.01.19, 1:04 AM
  • 2 mins read
Jean-Michel Cassé with J. B. Singh in Calcutta on Friday. A Telegraph picture

Accor Hotels, the French hospitality major, has chalked out an expansion plan in India that involves strengthening its presence in existing locations and eyeing a 25 per cent growth in its inventory of around 9,000 rooms over the next five years.

“Our expansion will be across brands. The main focus today in terms of portfolio is densification in existing cities. Let’s say in a city such as Calcutta we have three brands (Swissotel, Novotel, Ibis) and if we believe the market can support more, we will do that,” said Jean-Michel Cassé, chief operating officer — India and South Asia — Accor Hotels.

At present, the hospitality firm operates 50 properties across nine brands, including Swissotel, Fairmont, Sofitel, Pullman and Ibis.

Novotel is the biggest brand in the portfolio with 20 hotels followed by 19 under the Ibis brand.

Cassé was in the city to inaugurate the 189-key Ibis hotel in Rajarhat, developed in partnership with Interglobe Hotels. He said the upcoming hotels would follow the asset-light approach whereby Accor will be engaged primarily in managing the property.

“The priority of Accor today is to be asset light. But when we came in 10 years ago, we realised that we would be able to invest provided we have the right partner. We had to do this to make sure we can develop fast and with quality that we want to. Now we are growing by going asset light,” Cassé said, adding that majority of the upcoming hotels will be under this strategy.

Premium space

Accor will evaluate the premium hotel space after it has acquired brands such as Fairmont, Raffles and Swissotel in 2015 and Movenpick last year.

“It’s not a matter of just bringing new brands for the sake of bringing new brands. We need to make sure that every brand is relevant. There may be opportunity in the luxury space,” Cassé said.

“Developed with an investment of Rs 120 crore, Ibis Calcutta will have 189 keys, taking the Ibis brand to 19 hotels across 13 cities with over 3,000 rooms. Strategically placed near the airport, IT parks and malls, the hotel will cater to the emerging IT and ITES hub,” said J.B. Singh, president and CEO of Interglobe Hotels.

He added that more properties are in the pipeline in Mumbai, Goa and Bangalore with the room count expected to cross 4,000 by 2022.