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Sandeep Gupta, MD of Edenpark Hotels.

Sandeep Gupta, MD of Edenpark Hotels, promoter of Inovoa Hotels & Resorts and Executive Director, Asian Hotels (West) Ltd works with three brands – the Hyatt Regency, the Clarion and JW Marriott. He speaks to Hotelier India about expanding apartment hotels.

What are the future plans of Edenpark, Inovoa and Asian Hotels?
Gupta: Edenpark is the owner of one of the hotels, the first Clarion in the country, Clarion Collection, New Delhi, a 60 room boutique hotel with 30 serviced apartments.

Inovoa has signed a 20-year master franchise agreement with NYSE-listed Choice Hotels International for the Clarion brand. Hillwood Corporation USA, a Ross Perot Jr. company, holds 24% in the company.

IHRL has recently opened its first 130 room hotel property under its upscale Clarion Century brand at Whitefield, Bengaluru and has plans to develop a Clarion Hotel in Pune with an inventory of 100 rooms. Two more management contracts have been signed in Lonavala and Greater Noida.

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COMMENT   great to read about expansion plans from mr.sandeep gupta. The article hints that the group is looking at developing suc   1 Comments Read more comments »

Asian Hotels (West), which owns the Hyatt Regency Mumbai, is developing its second luxury hotel, a five-star deluxe hotel in Delhi, under the brand of JW Marriott, which will be operational by 2012. That will be a 525-room hotel with dining options, ballroom, health and spa facilities.

The company is looking at investing at least INR150 crore over the next five years to have around 10 Clarion-branded hotels across India. These include management contracts and developing hotels.

In addition, there is the Qutab Hotel bought from ITDC under the Government’s disinvestment scheme. We have turned a run-down loss-making unit to a successful, profitable venture. We bought it in 2002 and since then have fully renovated it. It is a 60-room property. It is now a profitable venture making about 40% GOP.

You were working with the economy segment of Choice hotels earlier. Why the change in focus now?
Gupta: Clarion is a Choice brand. But we have chosen to get out of the whole economy segment. There is growth there but the question is of returns. Land is very expensive. We did an analysis of locations left and did not find significant returns for the price of land, to suit us.

Even in Tier II cities, the brand which we have, will give us good returns. We’ll have good returns if we work on the basis of USD$150 ADR in multiple locations.

What are the challenges of running a franchise model in India? Which is better – being a management company or franchising your brand?
Gupta: Quality control is the biggest challenge. When you have badly developed products, the challenge is in control. Internationally, quality control is a stringent process.

They have a lot of systems in place. There are guest satisfaction programmes, which have not come into India at that level. Our battle was to put the money back into the property to upgrade it. It is a very slow process. We had to delete a lot of hotels.

In a franchise you constantly have to balance quality vis-a-vis growth. We have deleted the same number that we added. A lot of brand companies face different challenges. We’ve decided to focus on the key brand now. Management is the best way to support your brand. The hotel owner would employ all the staff. We provide the GDS, both from Inovoa and international systems.