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Hospitality Sector To Attract Over USD 2.3 Bn Investment In Next 2-5Yrs: CBRE

Hospitality Sector To Attract Over USD 2.3 Bn Investment In Next 2-5Yrs: CBRE




Indian hospitality sector will attract more than USD 2.3 billion in investment during the next 2-5 years as the hotel industry is on a recovery path post-COVID pandemic, according to CBRE. Real estate consultant CBRE on Wednesday released its report ‘Indian Hospitality Sector: On a Comeback Trail’ which stated that the outlook for the sector improved after a strong vaccination programme, reopening of borders, removal of travel restrictions, and sustained economic growth.

“A total of over USD 2.3 billion in investments are expected over the next 2-5 years, and more than USD 0.4 billion of investment is expected during 2020-2023 period. The report also states that around 12,000 rooms are likely to be added in 2023, and the number of rooms is expected to grow at a CAGR of around 3.3 per cent by 2025,” the consultant said. CBRE stated that a recovery in demand will remain ahead of supply addition, which will augur well for the key metrics of the hotel sector’s performance.

Hospitality Sector To Attract Over USD 2.3 Bn 'Investment' In Next 2-5Yrs: CBRE

Anshuman Magazine, Chairman & CEO – India, South-East Asia, Middle East & Africa, CBRE, said, “In recent years, several international hotel chains have made significant investments in the country, looking to tap into the growing demand for hospitality services. Several PE funds have also invested in domestic and international hospitality operators looking to expand their footprint in the country.

” The sector has also benefited from the government’s continued focus on reforms, as a result, the government expects the country’s tourism and hospitality sector to earn USD 50.9 billion as visitor exports by 2028, he added. CBRE said that the demand over the next few years is likely to be more equilateral and broad-based rather than being centered across only select cities/markets. It expects this steady supply growth to continue for the next few years. “Increasing investor interest has been one of the significant drivers of growth for the Indian hospitality space in the past couple of years.

In addition, Indian companies are also participating actively in this segment by way of investing or expanding their presence,” the consultant said. The international presence and acceptance of Indian chains have established the service level and visibility of these brands, it added. The report mentioned that all industry KPIs such as percentage of rooms occupied / occupancy rate; average daily rate (ADR)/average rental revenue per occupied room at a given time; and revenue per available room (RevPAR)/revenue generated by one room are expected to surpass pre-pandemic levels this year. RevPAR witnessed 94 per cent growth in India in 2022 as compared to 2021.


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Story first published: Thursday, May 18, 2023, 9:01 [IST]

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