The operator of Burj Al Arab is keen to have a property in either Mumbai, Delhi or at resort locations such as Goa and Kerala however it has not yet found the ‘right partner'
Dubai-based luxury hotel chain owner Jumeirah Group is still scouting opportunities to enter India. It is one of the few global hospitality chains that are yet to hoist their flag in the country.
The operator of Burj Al Arab is keen to have a property in either Mumbai, Delhi or at resort locations such as Goa and Kerala; however, it has not yet found the ‘right partner’. The company has an asset-light model of operation where it takes properties on a management contract.
The means that Jumeirah has aborted its plans to open its first property in Mumbai in the business district of Lower Parel. The group had signed a contract in 2012 for managing a luxury property that was earlier set to open this year.
Speaking to Moneycontrol Shaf Butt, Regional Director of Marketing, Middle East and Asia Pacific said, “There is nothing definite at the moment. Just like any other key city we are exploring opportunities. Our development team has been on an expansion journey where we are looking to have 50 hotels in 5-10 years. The team is surely looking at India too.”
Jumeirah has 24 operational properties across the United Arab Emirates, China, South Asia, UK and Germany. In addition, there are six properties under development. The brand competes in the ultra-luxury segment against brands such as Four Seasons, and Mandarin Oriental to name a few.
“Unfortunately, it does take time. A lot of our hotels are managed hotels. We have to not just find the right location but find the right owners as well to work with and this takes time. India has not been difficult than others it is just taking a bit of time. India is a major source market for Jumeirah and we are aware that we need to have a property here,” added Butt.
After a slowdown, the hospitality market has picked pace swiftly since the start of the current financial year. Across market segments, occupancy of 65 percent along with an average room rate of Rs 5,846 was recorded in 2018 according to STR Howarth.
Within this, the luxury segment has seen demand growing by 5 percent whereas supply grew by 3.2 percent. Demand in the upper upscale segment grew by 4.3 percent while supply grew by 2.8 percent, according to STR Howarth. This strong mismatch in demand and supply has led to a sharp spike in room rates.India’s hotel market has a branded room inventory on just around 100,000 rooms of which roughly half belong to the luxury segment.