Hotel Leela Venture Ltd., the subject of investment rumors for months, is selling four of its hotels and another property to a fund sponsored by Brookfield Asset Management for 39.5 billion rupees (US$576.41 million), according to news reports.
The Canadian company’s purchase part of a restructuring of the Indian company, which has nine properties in India. The four being sold are in Bengaluru, Chennai, Delhi and Udaipur; the property is in Agra, according to Reuters.
“The deal clearly indicates the growing interest levels by institutional capital in the hospitality sector in India,” said Manav Thadani, founder and chairman of consultancy Hotelivate. “Leela is a great Asian luxury brand and has big potential to grow in the larger region, which is why perhaps Brookfield also purchased the brand as part of the transaction. This leads us to believe they will potentially look to grow the brand’s current footprint beyond India.”
Thadani pointed out that this deal follows two IPOs by other Indian companies – Lemon Tree Hotel Group, which operates primarily in midscale and upscale properties, and Chalet Hotels, whose assets are mainly managed by Marriott – and as another one is underway: A REIT, a joint venture by Embassy Group and Blackstrone Group, is midway through its IPO.