Leela's Gurgaon, Udaipur projects late

Hotel Leelaventure, the holding company for Leela Hotels & Resorts, has missed the deadline for completion of its projects Udaipur and Gurgaon projects. Both projects were to be completed in late 2008, but now the Gurgaon hotel is likely to be launched in April and the Udaipur property in March or May this year.

The company is also set to open Leela Kempinski, Chennai, in 2009 and Leela Palace, New Delhi, in 2010. It also has projects at Pune, Hyderabad, Agra and Kolkata in various stages of development. Vivek Nair, vice-chairman and managing director, Hotel Leelaventure, told DNA Money that, though all the projects, except the ones at Agra and Kolkata, had been undertaken simultaneously, the company is focusing on completing the Delhi, Gurgaon, Chennai and Udaipur first due to the 2010 Commonwealth Games in New Delhi.

Nair added that the remaining properties will be up and running by 2012. "While land has been acquired in Agra, we will focus on Kolkata last as the city offers the lowest average room rate and revenue per available room." Incidentally, land is yet to be acquired in Kolkata.

Meanwhile, Leela has reduced the number of rooms at its proposed Chennai and Pune projects to 380 and 200, from 385 and 250. It will make the rooms larger, at 485-500 sq ft, against the previous average five-star size of 385 sq ft.

It is investing $500 million in expansion, of which $150 million is slated to be invested in the New Delhi project alone. The funds will be raised through a combination of FCCBs, debt and internal accruals.

Madhumita Mookerji / Daily News & Analysis Source: 3D Syndication