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Boutique brand The Postcard Hotel to open 23 new properties in next five years

NEW DELHI :

Indian hotel brand, The Postcard Hotel, which has built and restored boutique holiday hotels in India, Sri Lanka, and Bhutan, is expanding its portfolio. The company has 23 hotels under construction and will launch two new properties by the end of the year in India.

The three-year-old company is building hotels on the Maravanthe coast, in Mashobra, Amritsar, Tirupati, Ranthambore, and Uttarakhand. The company also said it will bring a second hotel in Bhutan next year.

In June, it launched its Gir Wildlife Sanctuary property spread over a 16-acre mango orchard. Typically, the properties have between six and 50 rooms.

Kapil Chopra, director at Untitled Hotels & Resorts Pvt. Ltd, the company that runs The Postcard Hotel, said that the company has ₹1,962 crore worth of assets signed and under way.

“Our aim is to have ₹7,500 crore ($1 billion) worth of assets under management within the next 5-7 years. I think we will do it faster though. There is also a possibility for us to build $2 billion-$3 billion assets under management over the next 10 years,” said Chopra in an interview to Mint.

The company is also looking at a historic property in Yangon, Myanmar though the expansion is not limited to South Asia. The company is evaluating locations in Scotland, Burgundy, Ibiza and Mallorca.

“We are competing with a well-developed hotel sector in India—so much of which is profitable, with companies that have strong assets and balance sheets and a great asset base, and telling them that we believe luxury should be seen differently. And here is our take on it,” Chopra said.

He said assets under management come under two categories: either a long-term revenue share lease of over 20 years with the owner or leased by the company directly.

Jaideep Dang, managing director, hotels & hospitality group at JLL said Untitled Hotels had partnered with JLL for development of hotels in India and the subcontinent. “It is a sustainable operating model where their company leases a property on a revenue share that secures owner’s interests on one hand and controls guest experience on the other.”

During covid, the company made an operating profit due to higher occupancy in places such as Goa. The company’s hotel room sells at about ₹25,000 upwards a night with a 24-hour check in model and anytime breakfast. “We were probably the only chain in the world which had a 51% growth in revenue over pre-covid numbers that too with four months of closure. Our revenues grew 51%, despite being at least 50% more expensive than any hotel in places like Goa,” Chopra said.

The company’s average length of stay went from two nights to nine nights in Goa.

The Postcard Hotel operates at a 50% premium to many hotel companies in the segment. In Bhutan, its rooms are priced at $200 more than competitor Aman Resorts. In Goa, it has close to a 50% year around average over any other luxury operator. The rate benchmarking has been close to Aman Resorts in any market.

The company has three distinct business models. One is the regular management fees model where it operates the property for an owner. While most hotels globally prefer to run hotels on management contracts, Postcard operates hotels on its own as it prefers to control all aspects from product development to guest standards.

In its second model, the company invests in and buys pieces of land and builds hotels on it. These fall into its owned hotels portfolio and can buy in two ways —invest directly with its own capital or work with a global REIT to help them participate in assets. It has recently signed an agreement with DMI Finance to build an ultra-luxury hotel in Ranthambore, for instance. The company also takes hotels on a “revenue-share” lease for over 20 years. The company manages payrolls and all expenses; the owners get a revenue share every month.

Aside from its registered entity, with every single project the company also forms an SPV or special purpose vehicle (depending on the model chosen by the owner), and forms new companies with each owner.

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