German luxury hospitality company Steigenberger has partnered with MBD Group to enter the Indian market. The two have formed a joint venture company that will operate, manage and franchise hotels in India under the MBD Steigenberger brand. Steigenberger, which operates 95 hotels across many countries, will be the first German hotel company to enter India.
The new company aims to open at least 20 luxury hotels in India over the next 15 years that could bring annual revenues of Rs 2,000 crore. MBD currently owns and operates two hotels (at Noida and Ludhiana) through a franchise model with Carlson Rezidor’s Radisson brand. MBD will hold 51% stake in the new JV company while the rest will be owned by Steigenberger.
Sonica Malhotra, joint managing director of MBD Group, said: “Of the 20 hotels that we are targeting, at least 4-5 will be owned by MBD. MBD is already setting up a 184 room luxury hotel in Bangalore that will be managed and operated by the JV.” The Bangalore property, expected to be operational by 2019, will also have 118 service apartments priced Rs 2 crore onwards.
She explained that the partnership with Steigenberger will bring international brand standards and training for operations and will also help in global sales and marketing for the hotels. The JV will look at having a presence in cities like Delhi, Mumbai, Chennai and Goa.
The JV will not immediately look at hotels in the mid-scale segment. But Malhotra said the scope of agreement can be expanded to include mid-scale hotels as well since Steigenberger also has two mid-scale brands — Inter City and Jazz in the City.