New Delhi: India's Lemon Tree Hotels has said that the Netherlands-based APG Asset Management, a pension fund manager, will invest Rs 6.5 billion to buy a strategic stake in it, and in the Rs 20 billion joint venture (JV) it plans with the hospitality chain.
Lemon Tree Hotels and APG will form the JV, namely Fleur Hotels Pvt Ltd, which will infuse Rs 20 billion to develop 4,500 rooms in the country by 2017, the Indian hotel company said in a statement Tuesday.
APG's combined investment in the JV and the stake in Lemon Tree Hotels is worth Rs 6.5 billion, the statement added.
Lemon Tree Hotels, having a pan-India presence, currently operates 18 hotels. All hotels that will be set up by the JV company will be branded as Lemon Tree Hotels, Lemon Tree Premier or Red Fox Hotels, the company said.
"...We are delighted to partner with APG in this endeavor to significantly increase the supply of mid-market rooms in India, which has huge unmet demand for this category of hotels," Lemon Tree Hotels Chairman and Managing Director Patu Keswani said.
"On completion of these proposed hotels by 2016-17, Lemon Trees will co-own and operate over 8,000 rooms , making it one of the largest hotel owners in India and the dominant player in the mid-market hotel segment."
APG manages pension assets totaling about 299 billion euros on behalf of Dutch pension funds.
"We view China and India as the major growth engines of the global economy and will expand our foot print further in these markets. India's consumption led economy provides incremental diversification benefits to our portfolio," APG Head of Non-listed Real Estate Daan Van Aert said in the statement.