Indian Hotels Company, which runs the Taj chain of hotels, will increase its presence in South Africa by developing one luxury hotel each in Johannesburg, Durban and Cape Town.
The total cost of the projects, which will add 550 rooms to the hotel chain in the African continent, is estimated at $180 million. IHCL has formed a 50:50 joint venture with Tata Africa, Taj International (SA) Pty. The joint venture will invest in individual hotel projects with local developers.
"Indian Hotels will manage the five-star hotels which will bear the Taj brand. The company is only finalising the projects with our core developers," said Tata Africa General Manager (New Business Development) Sunil Kapur.
The projects are likely to be over in 18 to 24 months. The joint venture is expected to invest about $20 million in equity. The financial closure for these projects is under finalisation. The company has already a hotel in Lusaka, Zambia named Pamodzi Hotel.
According to analysts, foreign arrivals in South Africa are over six million per annum. However, there is a dearth of luxury accommodation in the country, they pointed out.
Indian Hotels and Developer Eurocape Investments Ltd will jointly develop the luxury hotel at Mandela Rhodes, Cape Town. The project will have 200 rooms and options for residences. The site is a historical building and is next to Parliament and Mandela Rhodes Foundation. The proposed hotel in Durban Film City will have 200 guest rooms with 40 serviced residences.
"We could develop this project with VideoVision Entertainment. The proposed site is in close proximity to the International Convention Centre, the Cricket, football and rugby stadia," Kapur said.
IHCL has recently signed a memorandum of understanding with Melrose Arch Development Company to jointly develop high-end five-star hotel in Johannesburg.
"The location of the proposed project is strategic in nature, midway through Johannesburg Central Business District and Sandton city," Kapur added.
