Kotak Mahindra Realty invests Rs34 crore in Lemon Tree hotel group

24 August 2006

The Lemon Tree chain operates in the mid price segment (Rs3,000-5,000) per room night caters to the business and leisure travelers. The first two hotels in Gurgaon are already operating at over 90-per cent year round occupancy.

Two more hotels will be opened in Pune and Goa this year. In addition seven more hotels with a total room capacity of 1,300 are under development. When completed Lemon Tree Hotel chain will have properties in Delhi, Mumbai, Hyderabad and Chennai.

On the other hand the Red Fox is a limited service budget hotel chain charing Rs800-2,000 per room night.

According to Kotak Mahindra Realty's CEO S Sriniwasan, the fund believes in the need for mid market and economy hotels.

It may be recalled earlier this month private equity firm Warburg Pincus had invested Rs210 crore in Lemon Tree chain and Rs70 crore in the Red Fox chain.