India’s investor appeal remains robust, with the country poised to dominate 25% of Asia Pacific’s total hotel openings this year, and maintain the highest number of new openings through 2026, according to LE analysts.
Hotel investments in India have surged, achieving a deal volume of $401 million in 2023—a four-fold increase from the previous year, according to a JLL report. Greenfield project signings also jumped by around 8,000 keys, signaling the continued confidence of hotel developers in the industry’s long-term potential. High-net-worth individuals (HNIs) and institutional capital accounted for 31% of these investments, followed by real estate developers (27%) and owner-operators (11%).
In 2023, India saw a record-breaking 25,176 hotel signings and 12,647 new openings, with Tier-2 cities hosting the majority of these developments, JLL added. The fourth quarter alone registered 82 hotel signings representing 8,741 keys.
Despite the challenges between 2020 and 2021, India’s hotel industry has rebounded strongly. ADR and RevPAR exceeded pre-pandemic levels in 2022, while occupancy rates also showed significant improvement. RevPAR grew by 15.8% between October and December 2023 compared to the same period in 2022, according to a JLL report.
Hotel groups are quickly expanding to capitalize on this momentum. IHG plans to double its footprint in India within five years, signing 13 new agreements across luxury, premium, and budget sectors. Hilton is set to triple its Indian portfolio from 26 to 75 properties in the next three to four years, with 20 hotels already in the pipeline. Meanwhile, Marriott continues its rapid expansion, opening its 150th hotel after record-breaking signings in 2023 and early 2024. The chain aims to add 12 more hotels in 2024, particularly in the spiritual tourism sector. Accor, with 62 hotels in its current portfolio, signed 11 new agreements in 2023 and plans to open nine more properties this year across different segments.
With booming domestic tourism, rising demand for destination weddings, spiritual tourism, and both leisure and business travel, India’s hospitality sector is on track for sustained growth in the coming years.
