Bangalore-based Hansoge Enterprises has sold a hotel asset spread over 1.5lakh sft in the city in a deal estimated to be around Rs 150 crore to an ultra-high net worth individual.
The midscale boutique 175-room property is located near Bangalore International Airport and is expected to be completed by the end of 2024. The asset was with JC Flowers, an Asset Reconstruction Company(ARC), the Trustee, and the Bank.
“Focused on meeting the business needs of both parties involved, the exit strategy was structured for the promoters seeking to liquidate the asset and fulfilling the aspirations of the buyers aiming to establish a presence in the bustling metro location,” said two people aware of the deal.
In 2022, JC Flowers Asset Reconstruction has agreed to buy YES Bank’s NPAs. The private sector lender has transferred stressed loans worth Rs 48,000 crore to the ARC under the 15:85 structure for Rs 11,183 crore. “The asset is part of the deal between JC Flowers and YES Bank,” said one of the people quoted above.
Diversified real estate services provider Colliers India facilitated the sale of a boutique hotel in Bangalore.
“It was an intricate deal with several complexities considering the involvement of Asset Reconstruction Company and Banker along with Seller and Buyer, our team with an in-depth understanding of issues could navigate and get to successful closure”, said Piyush Gupta, Managing Director, Capital Markets & Investment Services, Colliers India.
The Hospitality sector in India has demonstrated promising potential and is headed towards exponential growth with increasing tourism, business travels, and appetite for a better lifestyle. “As residential, office, and industrial sectors continue to attract capital, the share of investments in alternatives is increasing and touched around 51% in Q4 2023, reflecting this trend”. said Gupta.
The firm’s capital markets and investment services business recently ventured into the hospitality segment, given the sector’s resilience after taking a hit during and after the pandemic.
As witnessed in Q3 2023, the hotel sector continues to display strong growth in performance, which is majorly driven by growth in ADRs. According to industry estimates, around 59 hotels comprising 4,669 keys were signed in Q3 2023 alone.
The Indian hospitality sector continued to witness Year-on-Year (Y-o-Y) growth in performance in Q3 2023, primarily driven by the significant rise in Average Daily Rate (ADR) of 15.6% over Q3 2022, resulting in a RevPAR growth of 15.1%, said recent reports.
