India’s Hotel Boom: What Western Brands Are Betting on Next

Glenn: Hey, everybody. It’s your hospitality. Friend Glenn here. Thanks for joining me. So one of the things that we talk a lot about is the Asian hospitality pipeline. I gotta tell you, China, China, China is taking all of the credit out there. So we’re going to talk about somewhere else commonly known in the Asian region. But before we do that, I want to thank our friends over at Activelle Activelle. They give you the power to profit. Please do me a favor visit. Com of course I’m talking about India. Much loved country. Not necessarily gets the credit it deserves for hospitality development and apparently it’s on a roll. So I called up our friend Mr. Bruce Ford over at Lodging Econometrics over there, and I said, hey, Bruce, what’s going on in India? Bruce? What’s going on in India?

 

Bruce: Well, Glenn, the story is is wild and crazy as you probably imagine. But the biggest thing about India that is compelling to me is the Western brands all now have a plan for what they want to do in India and how they want to grow their portfolio of their global brands. And of course, we we know, as we’ve mentioned many times, they have a full suite of brands now across all of the chain scales, multiple property brands in the full service, multiple property brands and upscale. And now they’re seeking to bring those to all of the best rate markets across the world. And India continues to see that kind of travel growth, that kind of population growth, that kind of economic growth that really attracts those Western brands and they find their business partners and they get to do projects together. And they have a much broader offering today on this side of the real estate cycle than ever before. Right. So first.

 

Glenn: Before we get into the numbers on India, which is I know where you’re going right now, I’m curious because I mentioned China and the parallel to, you know, there’s got to be a parallel to China. I’m thinking you’ll educate me because you know all this. It seems I’m getting the vibes that it’s like what China market was 20 years ago.

 

Bruce: You could certainly say that. And China was driven at that time by some of the Olympic events, obviously, Beijing hosting the Olympics, and they’ve now had a winter and a Summer Olympics.

 

Glenn: The first one was 2008, though, right?

 

Bruce: Yeah, yeah. They’ve now had a winter and a summer Olympics based around.

 

Glenn: That fits into they just started building the hotels about 2010.

 

Bruce: You’re just amazing okay. We should all admit it. We should.

 

Glenn: All what? I keep telling everybody. Maybe one day.

 

Glenn: Someone will get on board with me.

 

Bruce: But what happened in China 20 years ago was that the consolidation of the hotel industry really kind of brought more Western brands to China, and that has continued to trend that way. But when you have the first sweep of hotels that go into major markets where you’re kind of globalizing the market, if you will. It is always starts with full service.

 

Speaker3: And.

 

Bruce: It always starts. It always starts with the top three chain scales. Okay, of luxury, upper, upscale and upscale. Now in 2023. So three Q 2023 not.

 

Speaker3: Represented.

 

Glenn: On this chart.

 

Bruce: Total pipeline was 436 projects. Right. Here we are three Q 2025. And we have 838 projects.

 

Glenn: That’s massive bump.

 

Bruce: So that’s a doubling okay. And the types of projects have also changed. Back then we were looking at more mid scale and upper mid scale because that is often what is developed there. It’s either luxury or it’s 2 to 3 star. There was very little four star right. And so now we’re seeing a lot of four star with the upscale and upper upscale developments, so that many of them are also over 200 keys.

 

Glenn: Again, I feel like this is very much what China was back in the day, where it was the very high end of the market and the economy side of the market. And then what I think what’s happening now in India is people start moving around more frequently, have different income levels. The need for different categories starts to emerge. Does that make sense? Bruce?

 

Bruce: Also, yes it does, but also the soft brand will have a very big impact here. The curios, the tapestries, the autographs. Okay. The tributes the gardeners, these types of hotels that are, quote, more designed for the locals. Okay. And more designed to represent the local marketplaces versus you know, a red and green Marriott or, I’m sorry, a red and gold Marriott or a blue and gray Hilton. So as a for instance, those soft brands are some of the first things that come out. Okay. And in some cases, also the white label brands are part of what we’re going to see here too, which is a managed property that also will figure it out when we bring it into the family about the renovation and what we’re going to make it. Okay. And white label branding is a big part of what the franchise companies are doing for a strategy today is to say, come into our rewards program. Let’s get you into the system, and then we’ll figure out what to do with your asset. So in many cases, that comes out as conversion work. Okay. But in some cases that can come out as new construction also because they sign the project and say, we’ll figure out what brand it’s going to be once we design it.

 

Glenn: Yeah, that’s kind of been that’s kind of been the theme that you’ve been educating me about for a long time now is get him in the pipeline. If they don’t have a specific brand, you know that it’ll fit somewhere with either the brands or the soft brands.

 

Bruce: Right. And oftentimes, you’re kind of a remaking and a rethinking of the asset, because what is most important in a conversion is to create the upside potential. Okay. And to gather the upside potential when you join these rewards programs, you want to join them at a point where you’ve already elevated the asset to achieve that new rate that you’ve been seeking, or find that new plateau. Glenn, you remember we’ve been talking about the plateau.

 

Glenn: We did plateau, made it into the the title of the last video we did. Okay.

 

Bruce: But what we what we have also seen in India is a refreshed interest in master franchise agreements, whereby they sign a ten year or a ten hotel program with a particular developer and saying, you’re going to take these cities and put these three brands there. Sign one with another developer. You’re going to take these five cities, put these two brands there. So you know, it’s a long term commitment. The franchise companies are interested in that. The well-funded companies, they don’t really want to do things one at a time. They’d prefer to have partners that they can come talk to that have multiple locations within the marketplace.

 

Glenn: So talking about development in different cities, typically it starts in the larger cities. And I think we’re seeing that here as well.

 

Bruce: Right. But suburbia is really being created in India as they continue to draw new suburban lines similar to some of the major cities in the United States. As we we we are willing to commute 30 to 40 minutes but still be in the metro area.

 

Glenn: Kind of like New York City would say Nassau County or Westchester County, kind of adjacent to it. Yeah.

 

Bruce: So many of these markets have these pipelines that have continued to grow, but they haven’t all started construction yet. You’ll notice that just under 10,000 rooms scheduled to open this year. Then we’re going up to almost 11, then we’re going up to almost 12. And if I was to say what 2028 and 2029 looks like, we’re probably going to be opening 20,000 rooms a year in India in those years going forward, simply because the investment is headed this way. You have 100,000 rooms that are in the pipeline today for new construction, and only really 26 of them scheduled to open so far. So you’re three quarters of the pipeline not scheduled to open before 2028. Substantively, this is the look forward. Yeah. And one of those markets that’s kind of getting ready to get ready. So the economic conditions for operating performance in India are very good flight growth in terms of what they call daily arrivals at the airport continue to grow. Population continues to grow. Economic growth is there. And so therefore we see investment in the hotel.

 

Glenn: I personally just answered my last five questions that I didn’t have a chance to ask you. So that was really that was really helpful.

 

Bruce: I you know, I just sum it up, Glenn.

 

Speaker4: Yeah, you really do.

 

Bruce: I just sum it up so great.

 

Speaker4: So basically.

 

Glenn: You know, what you’re saying is that there’s probably more international arrivals to India coinciding with the growth of population and individual incomes and a change in the way their economy is working that more people are traveling than ever. So therefore, Bruce, I think you’re also saying that there’s a lot of depth to the market and opportunity to even increase that pipeline more. Would that be correct?

 

Bruce: Oh, that would be correct. If we’re going to open 20,000 rooms a year in India starting in 20 2028, we will need a pipeline that’s almost twice as big as it is today. So expect another doubling in a couple of years.

 

Glenn: Any any specific strategies you see going, is it going to be the major cities as represented in this chart here going forward? Or are we going to see more areas that are in the outskirts that secondary cities start to get a little bit more hospitality? Love?

 

Bruce: I think that there are probably a mix of both, I think. I think both things can be true here. And so we’ll say that the top 7 or 8 markets in India have Western supply already there. Okay. The and and significant Western supply. Yeah. The markets that are between like seven and 25. There’s a long way to go. Okay. And so those may be more of a focus for the Western brands coming to India and looking to continue to expand their markets. So there’ll be more cities that I will have to go learn to pronounce. And that’s okay. But at the end of the day the growth that we’re seeing in India is notable. It’s top three in the world. It is definitely a place where the franchise companies are seeking to focus.

 

Glenn: Bruce, you’ve left me wanting more. How can everyone out there learn more?

 

Bruce: So we’re currently in the process of releasing all of our quarterly updates on for press releases. Glenn and I will be doing some additional recordings together, but you can find us on LinkedIn at Lodging Econometrics. We’re on both Facebook and Twitter, as well as visit lodging econometrics.com/global Insights. We’ll get you all of that detail. And at any time I can answer any questions for you. We are continuing to maintain a global database of both existing supply and new projects in the pipeline.

 

Glenn: Excellent. And I want to thank you guys for being here. It’s got great stuff. Follow the legendary Bruce Ford over there and everything from lodging, econometrics. We’ll see you next time on another special report revealing all about the pipeline. Hi, everybody.