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Blackstone, the global asset manager, is reportedly seeking acquisitions in India's hotel sector, with the Chennai Hilton and a partially constructed Marriott near Bengaluru airport among its targets. Each property is valued between INR 300-400 crore, aligning with Blackstone's optimistic outlook on Indian hospitality. Ventive Hospitality, jointly promoted by Blackstone and Panchshil Group, recently filed for an IPO to raise INR 2,000 crore, strengthening its position. While the Chennai Hilton faces financial challenges, the Marriott property is awaiting final construction. Both hotels, if acquired, would strategically enhance Blackstone's hospitality portfolio in India.
Global asset manager Blackstone is reportedly exploring acquisition opportunities in India's hotel sector. Among the identified targets are the Chennai Hilton and a partially constructed Marriott hotel near Bengaluru airport, sources revealed. The expected cost for each acquisition is estimated between INR 300-400 crore. The US-based firm is optimistic about the potential of the hotel sector. Last month, Ventive Hospitality-a hospitality venture promoted jointly by Blackstone and the Panchshil Group-submitted a draft prospectus for an initial public offering aiming to raise up to INR 2,000 crore through a fresh share issue. Ventive Hospitality currently manages 11 operational assets under prestigious brands, including Marriott, Hilton, Minor, and Atmosphere. Advertisement
According to sources, the two prospective acquisitions would align well with Blackstone's existing portfolio, though the transactions may require some time to finalise. In response to an email inquiry, however, a spokesperson for Blackstone stated that the firm was not currently engaged in any discussions to acquire hotels in southern India.
The 204-room Chennai Hilton, owned by the Empee Group and managed entirely by Hilton, is located close to the airport and was established in 2011. The hotel has reportedly faced cash flow challenges and struggled with debt obligations in recent financial years, including FY20, FY21, and FY22, as per CARE Ratings. The Empee Group had also reached a one-time settlement with Edelweiss Asset Reconstruction, agreeing to pay INR 205 crore, though only a portion of this amount has been settled.
The Chennai Hilton has since been taken to the insolvency court, with various options being explored, such as debt settlement and restructuring. Sources mentioned that a sale to a major private equity firm could provide a viable solution for the hotel's financial difficulties. Requests for comment from Hilton and the Empee Group on the potential sale were not met with responses.
The under-construction 217-room Marriott Hotel near Bengaluru airport is being developed by Twenty Fourteen Hotels India, a subsidiary of the Lulu Group. Although operations have not yet started, pending work remains to be completed. Sources indicated that the hotel has been listed for sale, with a valuation of around INR 400 crore. The Lulu Group holds a 20-year lease with Marriott for hotel management, and the introduction of a new owner is not expected to affect this arrangement. Both Marriott and the Lulu Group did not respond to inquiries regarding the potential sale.
Blackstone's interest in acquiring high-potential hotels like the Chennai Hilton and Bengaluru Marriott signals its commitment to India's booming hospitality sector. The acquisitions would add significant value to its portfolio, supported by Ventive Hospitality's strong brand partnerships. Despite financial hurdles, these hotels present strategic growth opportunities for Blackstone.
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