In a marked strategic shift, Delhi-NCR based real estate major, Omaxe Group recently entered the hospitality sector with a mega INR 6200 crore investment plan to build 19 hotels across India. In an exclusive interview with Torbit Realty, Mohit Goel, Managing Director, Omaxe Limited talks about company’s business strategy and investment plans in hospitality segment, rise of hospitality-led mixed-use real estate developments, growing interest of institutional investors in hospitality and key opportunities and challenges before real estate players entering hospitality segment. Excerpts

VINOD BEHL

What makes more and more real estate players enter the hospitality segment? Is it because hospitality complements their commercial, retail and township developments? What made you get into hospitality?

Hospitality is becoming a natural extension of large-scale real estate development. Well-planned hospitality assets increase footfalls, support commercial activity, enhance the attractiveness of mixed-use destinations and create recurring revenue streams. For Omaxe, the decision is driven by the evolution of our developments into integrated ecosystems where people live, work, shop, travel and spend leisure time. We see hospitality as an important component that strengthens the overall value proposition of these destinations while addressing growing demand from business travellers, tourists and pilgrims.

 As a business strategy, will you have standalone hospitality projects or part of your existing townships and commercial hubs? Will you be focusing on luxury, mid-scale or mixed-use developments?

Our primary focus will be on hospitality assets that are integrated with our existing developments, including townships, commercial hubs and mixed-use destinations. This allows us to leverage established catchments and create stronger destination value. From a product perspective, we are adopting a market-specific approach rather than a single format. The portfolio will include a mix of midscale, upscale and premium hospitality offerings, along with serviced apartments and extended-stay formats, depending on the demand profile of each location.

 What will be your business model—asset light, management contracts or ownership-led developments or partnerships with established brands/operators?

Our strategy is to develop and own the hospitality assets while partnering with established national and international hospitality operators for branding and management. We believe this approach combines the strengths of real estate development with the operational expertise and distribution capabilities of leading hospitality brands. We are currently in advanced discussions with several operators and will announce partnerships as agreements are finalised.

 What’s the scale of your plans with regard to investments and geography?

We have announced an investment of approximately Rs. 6,200 crore to develop 19 hotels across 13 cities in five states over the next four to five years. The portfolio spans key markets such as Ayodhya, Lucknow, Vrindavan, New Delhi, Faridabad, Chandigarh, Amritsar, Ludhiana and Ujjain. Together, these developments will cover nearly 5 million sq. ft. and cater to business travel, leisure tourism, MICE, destination weddings and religious tourism.

 How do you see the growth prospects in the hospitality sector, particularly with the rise of branded residences, serviced apartments and spiritual tourism?

The outlook remains very strong. India is witnessing growth across multiple travel segments simultaneously. Spiritual tourism is expanding rapidly, supported by investments in connectivity and infrastructure across destinations such as Ayodhya, Vrindavan and Ujjain. At the same time, changing travel patterns are increasing demand for serviced apartments and extended-stay formats. Branded residences are also gaining traction among buyers seeking professionally managed assets and hospitality-led experiences. These trends are creating new opportunities across hospitality formats and customer segments.

 Do you see real estate developers increasingly diversifying into hospitality with integrated developments to enhance the value of their assets and to target annuity income?

Yes. As developments become larger and more integrated, hospitality can play a significant role in enhancing destination appeal and supporting commercial activity. It also provides developers with an opportunity to build stable, recurring income streams alongside traditional development revenues. I believe hospitality will increasingly become part of the broader mixed-use development strategy adopted by leading real estate companies.

 Hospitality being capital intensive, do you think enough institutional capital is available and what policy measures are required to boost investment flow?

Institutional interest in hospitality has increased significantly over the past few years, particularly in markets with strong tourism, business travel and infrastructure growth. However, the sector remains capital intensive and has relatively long gestation periods. Faster approvals, greater infrastructure support, improved access to long-term financing and policy measures that encourage tourism development can further accelerate investment. Continued investment in connectivity and destination infrastructure will also play an important role in attracting capital into the sector.

 What are the key opportunities and challenges for real estate developers getting into the hospitality segment? Going forward, do you see hospitality becoming a core vertical along with real estate?

The biggest opportunity lies in the growing demand for quality hospitality infrastructure across business, leisure and pilgrimage destinations. Developers with strong land banks and destination creation capabilities are well positioned to participate in this growth. At the same time, hospitality requires a different operating model, specialised expertise and a long-term investment horizon. Success depends on selecting the right locations, product positioning and operating partners. For Omaxe, hospitality is being developed as a strategic business vertical that complements our core real estate operations and contributes to long-term value creation.