Carlson not to renew contract with Sarovar Hotels

August 21, 2008	(Be the first to rate this story!)  Loading ...
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Carlson’s contract with Sarovar Hotels as master franchisee of Carlson’s Park Plaza and Park Inn brands in India is not likely to be renewed, according to reports. Minneapolis headquartered Carlson remains unlikely to renew the arrangement as the company feels it has gained enough insight into the Indian hotel and hospitality market and prefers to manage its own brands in the country directly. It has been leaning more towards the management contract model of late, which yields higher revenues. Global hospitality group Carlson owns the Radisson, Regent and Country Inn & Suites brands besides interest in restaurants and cruises. It manages the Radisson brand on its own but Sarovar Hotels and Resorts which runs properties like Hotel Marine Plaza, a sea-facing property on Marine Drive in Mumbai and Hotel Park Plaza in Gurgaon, has been given the master franchisee for its Park Plaza and the Park Inn hotel brands.

“It is highly unlikely that the arrangement would see a renewal,” a source disclosed according to a report. When contacted, K B Kachru, Vice president for South Asia for Carlson refused to comment on the development, but did not deny the report either. The change in relationship between Indian hoteliers and foreign players should not be seen as a problem but as a sign of a maturing market, according to an industry consultant. Similar changes have already been taking places in the hotel industry. For instance, only recently ITC Hotels and Starwood Hotels changed the terms of their collaboration after 30 years of alliance. Oberoi Hotels owned by East India Hotels broke their ties with Hilton which has since joined hands with DLF.

It would be interesting to watch how the contracts with the ongoing projects will be handled. For instance, Hotel Majestic Park Plaza, the only five-star hotel in Ludhiana is currently upgrading its property by adding 25 rooms to exclusively cater to business and corporate travelers and aiming for a five-star deluxe classification.

Meanwhile, Mumbai-based Sarovar Hotels and Resorts opened the country’s first branded budget hotel Hometel last week and plans to open eight more such hotels across India by the year end to tap the mid-upper middle level businessmen and holiday makers. Apart from the existing 35 hotels under the Sarovar banner, the company is setting up 33 hotels, which are in various stages of development. Another 30 plus hotels are on the drawing board. By the end of 2012, the company will have around 100 hotels and manage a room inventory of close to 100,000 rooms according to Anil Madhok, the Managing Director of the company.

News Published Under:   Hotel Industry in India |

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