The MBD Group that currently owns two hotels in the country -- Radisson Blu MBD Hotel, Noida and the Radisson Blu Hotel, Ludhiana is bullish on the hospitality sector and has entered into a 51:49 joint venture with one of Europe’s leading hotel companies, the Steigenberger Hotels AG. The two companies together plan to have 20 hotels in India by 2030 with projected annual revenue of hotels under management of nearly Rs 2000 crore.
“We were looking at expanding in the luxury space and had been approached by a couple of other companies but we thought Steigenberger was the best fit,” says Sonica Malhotra, managing director of the joint venture and managing director of the MBD Group.
Steigenberger had been planning to foray into the Indian market for a while but realised that it needed a partner as India presents its own unique challenges that are best handled by a company familiar with the nitty-gritty of the Indian environment. “Some companies have flopped in India even though they have been very successful abroad,” explains Malhotra.
The Indian hotel industry is on an upswing right now with revenues likely to improve by 9-10 per cent in 2016-17, mainly aided by improved occupancy, as per rating agency ICRA.
So what will both the parties bring to the table? Under the joint venture, the management of the company would be in the hands of the MBD Group looking after the India wide operations of the brand including business development, management and franchising of hotels, India marketing, pre-opening and post-opening assistance, etc. “Steigenberger would be providing international sales and marketing support – both online and off line, training and brand standards and also their loyalty programme,” elaborates Malhotra.
The first hotel will open in mid 2019 in Whitefield, Bangalore. Called MBD Zephyr Bangalore, the flagship property will have 184 rooms and 118 service apartments. “We will be focussing on key cities such as Delhi, Mumbai, Chennai, Hyderabad, Goa, Pune and Kolkata. Bangalore, alone can take a couple of more hotels,” says Malhotra. Of the 20 hotels, five will be owned by MBD. The others will be run and operated by the company. “We will be looking at potential projects in both green field and brown field stages,” says Malhotra.
Radisson Blu, Noida is known for its F&B offerings, especially its signature restaurant, Made in India, which has won several awards. Malhotra is keen on taking the brand to other Steigenberger hotels in both India and abroad.
Malhotra says that as of now the JV does not change anything regarding the arrangement with Radisson for the existing hotels. MBD has a licence to run the Noida property under the Radisson Blu brand for eight years and the Ludhiana property for five years.
