In a strategic licensing agreement with Olive by Embassy, Hilton plans to add 150 Spark brand hotels across India in the next decade. The move is meant to close the gap with rivalling hospitality groups and will concentrate on India’s middle-income consumer market.
With 29 hotels in India, Hilton lies far behind competitors such as InterContinental (45), Hyatt (50) and Marriott (150). Over the past decade, the Virginia-based company has been concentrating its Asian activities on the Chinese market but the deal with Indian billionaire Jitendra Virwani’s Embassy Group is set to change that policy. Only last month, Hilton CEO Christopher Nasseta said third-quarter room revenue in China dropped by 9% with Chinese consumers being confronted with macroeconomic challenges.
“This landmark signing with Olive by Embassy underscores Hilton’s bold ambition in and long-term commitment to South Asia,” said Alan Watts, President at Asia Pacific at Hilton. “Spark by Hilton will address a gap in the Indian market, offering affordable stays without compromise, and capturing unmet demand for value and consistency across major and smaller cities. Not only will this partnership set the stage for record-breaking growth, but it also positions Hilton to achieve a commanding presence in one of the world’s largest lodging markets.”
Just like its competitors, Hilton will be concentrating on the middle-income consumer market. Since the end of the pandemic, domestic travel of such kind has been on the rise in India.
“We are committed to expanding our presence in South Asia. Rapid middle-class formation continues to take place across this dynamic region, where we see tremendous long-term growth prospects for Hilton. Following international debuts for Spark in the United Kingdom and Canada, there is a compelling opportunity for the brand’s flexible model, coupled with Hilton’s powerful network and commercial engine, to capitalise on the fast-growing premium economy segment in India”, said Kevin Jacobs, chief financial officer & president of Global Development at Hilton.
The partnership with Embassy Group in India doesn’t come as a surprise, given the fact that the company already owns Hilton Bengaluru Embassy Manyata Business Park and Hilton Garden Inn Bengaluru Embassy Manyata Business Park. The strategic licensing agreement means the group will be investing up to 45 billion rupees (€505 million) into the 150 Spark by Hilton hotels.
“Today’s agreement marks an important step forward in our partnership with Hilton. Spark by Hilton is the ideal brand to capitalise on the country’s growing middle-class, its infrastructure investment push, and its burgeoning hospitality sector. With Embassy’s deep understanding of the market, and the local expertise of our franchise partners, we believe that this is the beginning of an exciting journey to redefine the premium economy segment”, stated Jitu Virwani, Chairman & Managing Director at Embassy Group.
The first Spark hotels in India are set to open in the southern part of the country, in states such as Maharashtra, Andhra Pradesh, Telangana, Goa, Karnataka, and Tamil Nadu. There will be an average of 100 rooms per hotel, resulting in at least 15,000 rooms upon completion of the entire project.
