Newstrack

Starwood Capital to debut its hotel brands in India

EH Staff - Mumbai

Starwood Capital, a global real estate investment fund, is looking to launch its luxury hotel brand Hotel de Crillon, its eco-friendly hotel brand `I' and its budget hotel chain, Campanile in India.

Barry Sternlicht, its chairman and CEO, says, "We are looking to invest close to US $300 million over the next 18 months." Starwood Capital has currently about US $2.5 billion in capital under management. It has invested over US $5 billion in equity and US $14 billion in debt till now. It created the Starwood Group of Hotels that owns brands such as Sheraton, St Regis and Westin. Starwood Capital is also one of the leading owners of golf courses around the world.

What might affect Starwood's plans is the prevailing real estate environment. "The market is very buoyant right now," says Sternlicht. But with the economic fundamentals strong and stock markets showing no signs of nervousness, Starwood will have to look at a smart entry strategy. "We are looking at a range of options - FDI, real estate fund, investment in real estate developers. For starters though we would like to enter the hospitality sector and invest in hotels," he says. It then plans to invest in land and later in commercial office space for corporations as well as SEZ once the policy becomes clearer.

The planned introduction of Hotel de Crillon, a six-star property, would be part of a global push being given to this top-end Paris hotel. Campanile is on the other end of the spectrum. Budget is priced at 55 Euro a day range and is present at 350 locations throughout Europe. Starwood made its first investment in China about two months ago but Sternlicht finds India a more attractive market. "I think the Indian market is a lot more transparent and in China, the Hong Kong Chinese dominate the scene. I am not sure about an American company's ability to add value there," he says. The one thing that he would really like the Indian government to improve - apart from the airports - are the zoning laws. "I think what you have right now is an urban sprawl. You have to have distinct districts for residential and retail properties," says Sternlicht.