Piramal Finance Forays into Hospitality Sector

Commits INR 1200 crores across Marquee Hotel Assets in Gurgaon (Westin), Bangalore (JW Marriott) and Pune (Crowne Plaza)

Piramal Finance Ltd (PFL), a subsidiary of Piramal Enterprises Ltd, has forayed into the hospitality sector with multiple transactions done in quick succession. The platform has committed INR 650cr towards two marquee hotel assets in North India, followed by another INR 550cr across another two assets in Bangalore and Pune, respectively.

PFL deployed INR 650cr in Vatika Hotels Pvt Ltd, thereby providing a comprehensive financing solution to the Vatika Group to consolidate their existing lenders and increase their stake in the company by providing an exit to existing equity investors. The investment was made against two established hotel assets being operated by Marriott.

The Westin Gurgaon is a 313-room key hotel strategically located in Gurgaon’s central business district near IFFCO Chowk. The hotel has been operational since 2010 and is a highly successful business cum leisure destination with consistently high occupancy rates and an established F&B and Banqueting business. The Westin Resort Sohna is an established destination property developed as a weekend getaway located an hour away from IFFCO Chowk.

Similarly, in one of the largest fund raising deals within the hospitality sector in Bangalore, PFL has sanctioned ~INR 550cr of structured debt towards the Advantage Raheja Group (promoted by Deepak Raheja) to support their growth plans and enable a refinance of existing lenders across two hospitality projects – The JW Marriott in Bangalore and the Crowne Plaza in Pune. Both the properties enjoy the advantage of being in prime locations and expect excellent growth in terms of Occupancy and Revenue per Available Room (RevPAR).

Hospitality is an evergreen sector and quality assets at good locations have thrived across business cycles. Hotels are long gestation projects and require long term financing partners who can provide tailor made solutions which can help the asset ride successfully across business cycles. PFL has always followed a partnership approach and will follow similar approach with respect to investments in hospitality with the ability to participate across the entire capital stack – be it senior debt opportunities, mezzanine funding, last mile funding towards completion and acquisition financing opportunities in the sector.

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