Theweekendleader

Govt to appoint consultant for hotels Ashok, Samrat

New Delhi

10-December-2019

The government will decide on appointing a consultant among CBRE, Feedback Infra, JLL Pvt Ltd, KPMG and PwC, who will study lease terms and conditions of land, laws regarding construction and development of property in the areas which is currently being used by Hotel Ashok and Hotel Samrat complex. Both are Five Star properties.

A department of investment and public asset management (DIPAM) notice said there will be engagement of a consultant to study the lease terms and conditions of land, prevailing laws, provisions and restrictions if any pertaining to construction and development of property in the area, existing arrangements being used by Hotel Ashok and Samrat Hotel complex.

The companies in fray are JLL Pvt, KPMG, Pricewaterhousecoopers, Feedback Infra and CBRE. Both hotels are state-run ITDC owned.

ITDC shares are at Rs 335.30, down by Rs 2.80 (0.83 per cent).

ITDC to appopint a consulting firm that can take them through the leasing process and how it should be structured.

In mid October, the India Tourism Development Corporation Ltd (ITDC) told exchanges in a regulatory filing that the department of investment and public asset management (DIPAM) is in the process of appointment of a consultant to explore the possibilities of handing operation and management or subleasing the property.

ITDC had said the purpose of the exercise also includes optimum utilization of vacant and unused land in Hotel Ashok-Samrat Complex.

Hotel Samrat is adjacent to Hotel Ashok, the real estate lying in the prime areas of Delhi's Chanakyapuri that houses various foreign embassies including the Prime Minister's residence.

The government holds 87.03 per cent stake in ITDC. The Ashok-Samrat property is a key part of ITDC's portfolio and plays host to several government functions and important industry events.

ITDC, a public sector undertaking under the tourism ministry, is currently running nine hotels including ones in Jammu, Patna, Bhubaneswar, Mysore, Itanagar, Ranchi, and Puducherry.

Excluding the hotel in Jammu, the ministry of tourism had decided to transfer to the state governments or go in for joint leasing with the state government the loss-making hotels in Mysore, Itanagar, Puducherry, Patna, Bhubaneswar, and Ranchi under the disinvestment policy of the government.

"Both the assets are beyond any sale. The value running in thousands of crores due to their prime locations and is also situated in a security zone of strategic importance. So its divestment had been difficult.

So, the government will give it on a lease and will try to utilise land to the maximum," said a rival hotelier.

Both hotels are managed by long term leasing arrangement on the lines of the Taj Mahal Hotel which is the best bet for the hotel as the value of the asset is tough to compute and no hotel chain is positioned to buy as well as manage it.IANS