Lemon Tree Hotels Ltd. is implementing a ₹ 1,700-crore capacity expansion programme that will see it add 1,500 rooms, taking the ownership route, over the next three years.
Half of the capital expenditure has already been made, and the remaining ₹ 850 crore is to be deployed by FY 2021, according to Vikramjit Singh, president of the company.
Lemon Tree Hotels now operates 4,907 rooms in 49 hotels, including managed hotels, across 31 cities. By FY 2021, it plans to operate 78 hotels with 8,152 rooms across 54 cities.
In doing so, the focus would be on building on the asset-light model, one that would see the leading player in mid-priced hotel segment manage more hotels, under its brand. At present, 64% of Lemon Tree Hotels rooms are owned, while the rest are either leased or managed. In three years, the company would like the share of own properties to come down to 50%.
Mr.Singh, who was speaking at the formal opening of Lemon Tree Hotel in Banjara Hills here, cited an industry report that had projected a mismatch between the demand and supply of hotel rooms. Such a scenario, he added, could trigger price rise.
The new 85-room facility opened in Hyderabad is the fourth of Lemon Tree and takes the cumulative inventory of the hospitality player to 663 rooms in the city. On the overall occupancy levels, it was a little over 65% for the hospitality sector. However, Lemon Tree had over 76%, he said.
