Over 8,500 keys to be added in hospitality sector this year

Chennai: Over 8,500 keys will hit the hospitality market in 2019, an increase of 19 per cent over the previous year. The investment transactions in the industry is expected to more than double in 2019 as the volumes had hit 18-year low last year.

In 2018, the hotel industry saw 134 new hotels with a total 7,215 keys getting opened. The year 2019 is expected to see a 19 per cent growth in number of keys—8,754 keys in 105 properties, as per a report by HVS and Anarock.

Domestic operators opened 65 hotels of the total 134 openings in 2018 and this represented nearly half of all the openings. In terms of key counts, domestic operators represented only 32 per cent of the total 7,215 keys. International hotels opened larger hotels with more number of keys.

Marriot Hotels and Resorts, IHG and LemonTree were the top hospitality brands which opened new properties in 2018. Bengaluru got 8 new properties with a total key strength of 1346.

Meanwhile, hotel transaction volumes contracted in 2018 to its lowest level since 2005 in dollar terms. The hospitality industry transacted $79 million in 2018, which was a steep fall from $257 million in 2017. In 2019, HVS and Anarock anticipate the market to witness an upsurge in transaction volumes to $200 million on the back of distressed pricing of hotel assets. The current year is likely to witness sale of high value hotel assets in almost all key hotel markets of the country estimated at $800 million, potentially setting a record for hotel transactions in the country.