JLL India report highlights country’s robust growth in hospitality sector

In 2023, the sector saw monumental progress with USD 401 million invested, nearly quadrupling from the previous year.

Hyderabad: JLL India has unveiled its report ‘Hotel Investment Trends – India 2023,’ highlighting India’s robust growth in the hospitality sector. The first quarter of 2024 marked a significant upsurge with hotel transaction volumes hitting USD 78 million, an 80 per cent increase year-on-year.

In 2023, the sector saw monumental progress with USD 401 million invested, nearly quadrupling from the previous year. According to the report, a notable 25 per cent of this investment was in under-construction hotels across business and leisure destinations.

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Additionally, 2023 witnessed a record 22 hotel transactions, the highest in a decade, with three hotel companies debuting successfully on the stock market via IPOs.

High Net Worth Individuals (HNIs) and institutional capital dominated investments in 2023, constituting 31 per cent, followed by real estate developers at 27 per cent, and owner-operators at 11 per cent. The upper upscale hotel segment saw the most significant activity, followed by upscale, luxury, and midscale segments. Notably, five transactions worth USD 133 million were facilitated through the insolvency resolution process under the National Company Law Tribunal (NCLT).

Jaideep Dang, Managing Director of JLL’s Hotels and Hospitality Group, India, expressed optimism for 2024, citing strong performance in hotel stocks and diverse growth avenues like expanding commercial office markets and new infrastructure developments.

Management contracts continued to dominate signings, accounting for 78 per cnet of total keys signed, while lease and revenue share models saw a rise, comprising 4 per cent of total signings. This growth trajectory is attributed to the sector’s enduring confidence in long-term potential, especially evident in Tier-2 city developments and emerging tourism hotspots.