The government is planning to allow hotels to build and sell apartments in their complexes in Delhi, a move that may benefit several hotels in the city except those that fall within the restricted Lutyens’ Bungalow Zone.
Hotels will be allowed to use the 20% of the total built-up space, where they are permitted to set up a commercial and retail wing, to develop apartments, a senior official at the Delhi Development Authority said, on the condition of anonymity. “The government’s move will significantly reduce the initial capital requirement for hotel projects. Hotel developers will be able to utilise the funds available through residential pre-sales to offset the level of debt funding,” said Siddharth Thaker, managing partner at Prognosis Global Consulting. New and existing hotels will also benefit by way of improved ROIs and breakeven on initial capital investment will be shortened, he added.
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