InterContinental Hotel Group (IHG) is getting all set to debut its ‘limited services’ mid-market brand Holiday Inn Express in Ahmedabad later this year. The chain, which runs brands such as InterContinental, Crowne Plaza, Holiday Inn, among others, is betting big on India. As Chief operating officer, South West Asia, Mr Chris Moloney, based in Gurgaon, points out, the pipeline for 47 hotels here in India, is the third largest for the company globally. Excerpts from an exclusive interview:
How many hotels will you be opening in India in the next few years?
We have a current pipeline of 47 hotels which is the third largest pipeline for our company globally. These hotels will open between now and 2016. Our goal is to operate 150 hotels by 2020. This year we will open five hotels including hotels under Crowne Plaza and Holiday Inn brands. Over 80 per cent of our upcoming properties are going to be under the Holiday Inn or Holiday Inn Express.
Why are you betting so much on the Holiday Inn Express brand in India?
Typically, a majority of the hotel room inventory has been built in the upper upscale. With nearly 740 million domestic trips happening primarily in the business and MICE segment, there is an enormous opportunity for the mid-scale brand. Another aspect is that the average number of days spent on business travel in India is about 27 days. And no one brand owns this space. Business travellers usually stay in different hotels depending on the locations rather than travelling by brand. We believe Holiday Inn Express is a value brand targeted at the business traveller segment. It is a brand that will have key hallmarks that will focus on quality breakfast, quality sleep and quality showers— basically convenience for the business travellers. We would not run restaurants on our own but outsource this space to partners.
InterContinental has launched two new brands ‘Even’ in the US and ‘Hualuxe’ targeted at the Chinese market. Are you planning any brand customised to India?
Unlike China, India has very strong hotel domestic brands. And whether there is a need to launch a domestic brand for India, time will tell. We still have other brands such as Indigo and Staybridge that have not been launched in India yet.
With real estate prices so high, isn’t it a challenge to build economy and mid-scale hotel in the country? How do you meet this?
The cost of real estate is significant which makes the gestation period longer. But we in our joint venture with Duet are organising the operations of hotels in a way that some of the space typically used by back office or services is not being built in the Holiday Inn Express hotels. (Intercontinental has a JV going with Duet India Hotels Group to develop 19 Holiday Inn Express brands). We would do some functions such as accounting from our office here in Gurgaon. We are also trying to use technology and processes such as pre-fabrication to build hotels efficiently and faster. We are also trying to build in multi-use development such as taking up the upper floors of a mall of an office complex.