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Delhi-based Lemon Tree Hotels has entered into a strategic partnership with Dutch pension fund asset manager, APG, to build mid-market hotels in India.
The two partners will set up a joint venture company called Fleur Hotels to develop and run these hotels. APG has also picked up a direct stake in Lemon Tree Hotels. Its combined investment in the joint venture and Lemon Tree Hotels is Rs 650 crore.
Fleur Hotels will invest over Rs 2,000 crore to develop and own 4,500 rooms by the end of 2016. These hotels will be under the brands Lemon Tree, Lemon Tree Premier and Red Fox Hotels.
“On completion of these proposed hotels, Lemon Tree Hotels will co-own and operate over 8,000 rooms, making it one of the largest hotel owners in India and the dominant player in the mid-market hotel segment,” said Mr Patu Keswani, Chairman and Managing Director, Lemon Tree Hotels. He added that the joint venture company will significantly increase the number of mid-market rooms in India which has a huge unmet demand.
Lemon Tree Hotels has 2,000 operational rooms and another 1,600 rooms under development
APG manages about $393 billion on behalf of Dutch pension funds. Besides the founder Chairman, Mr Patu Keswani, private equity player Warburg Pincus is among the large shareholders of Lemon Tree.
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