India’s hospitality sector witnessed a strong USD 93 million in investment during the first half of 2024, according to JLL's Hotel Investment Trends in India for H1 2024. With the year-end forecasted to close at USD 413 million, this marks a 22% increase from 2023, highlighting the sector's resilient growth trajectory.

According to JLL, operational hotels made up 72% of the total transaction volume, with 23% attributed to under-construction properties, and the remaining 5% involving land leases, particularly for greenfield developments in key airport districts.

The report revealed six major hotel transactions during this period, spread across Tier I and leisure markets. Listed hotel companies dominated the investment landscape, accounting for 44% of the total volume, followed by owner-operators at 30%, and High-Net-Worth Individuals (HNIs), family offices, and private hotel owners contributing 26%.

Jaideep Dang, Managing Director of Hotels and Hospitality Group, India at JLL, commented, “The first half of 2024 has set the stage for a vibrant hotel transactions landscape for the rest of the year. The projected year-end volume of USD 413 million reflects a 22% growth over 2023, illustrating the strength of the sector amid favorable macro-economic conditions, expanding commercial markets, and improved air connectivity.”

Tier I markets such as Mumbai, Hyderabad, Pune, and Chennai led the way, accounting for 78% of the projected transaction volumes. Tier II and III markets followed with 22%, demonstrating increased investor interest in both metro and emerging destinations.

Notably, the first half of 2024 also saw 19,442 hotel keys signed, with a significant 83% located in Tier II and III cities. Management contracts remained the preferred mode of operation, making up 89% of the signings, followed by franchises and lease/revenue share agreements. The number of greenfield projects also surged, with 13,700 keys signed, surpassing the total number of signings in 2023.

As for the Radisson Hotel Group, the company reported robust growth with over 130 new signings and openings globally in H1 2024. Their Radisson Collection, Radisson Blu, and Radisson RED brands spearheaded this expansion, with Radisson RED making its entry into new markets such as Ireland, New Zealand, Thailand, Laos, and China. The brand also debuted in Paris with the signing of the first Radisson Collection near the Louvre Museum, while the Radisson Collection Hotel Roma Antica opened in Rome, near the Pantheon.

Jaideep Dang further noted, "Investor interest in both operational assets and land sales highlights the attractiveness of the current investment environment. The expansion of air connectivity, especially in Tier I cities, is playing a significant role in supporting this growth, as is the continued demand for domestic travel and commercial activity.”

With two major transactions already facilitated by JLL in the second half of 2024, amounting to USD 70 million, the sector is set for an exciting close to the year, further reinforcing confidence in India’s booming hospitality industry.