Abbas Rangwala is the Head of Mergers & Acquisitions at InterGlobe, the holding company of IndiGo Airlines and InterGlobe Hotels, and one of India's largest groups with businesses across hospitality, real estate, travel technology and business services. InterGlobe, in addition to its existing India portfolio of 30 hotels, has recently built a sizeable portfolio of 13 hotels internationally through successful acquisitions in key markets, particularly across Europe.
Ahead of his participation to the International Hospitality Investment Forum (IHIF) in Berlin, Germany on 1-3 September 2021, Abbas Rangwala shares his views on hospitality and his company’s investment strategy.
Hospitality Insights: What is your company’s main area of focus to drive recovery in 2021?
Abbas Rangwala: The recovery in 2021 is largely dependent on the external environment and there is a lot of uncertainty currently. We remain positive about the second half of 2021 being considerably stronger and are working closely with our operating partners towards capitalizing on the same. We believe that an improved guest experience at our hotels with focus on individual traveller needs, savvy revenue management, stronger technology and of course, effective people management will be key towards driving stronger operating and financial performance.
We are also planning a refurbishment of our hotel portfolio across Europe. Currently we are undertaking a hard refurbishment at the Sheraton Amsterdam Airport Hotel & Conference Centre and will be ready to welcome guests into a highly attractive offering later this year. We have also embarked on a new lifestyle brand and re-positioning plan for our select European hotels, details of which will be announced in the near future.
Hospitality Insights: Your international hotel portfolio focuses on city hotels. Are you expecting them to be more severely affected by the lack of corporate travel?
Abbas Rangwala: Yes, there has been considerable impact to our hotels due to various travel restrictions in place currently. Europe in general has been particularly hard hit. Having said that, we are confident that there will be a stronger rebound as well, given the prime location of our city assets and our repositioning plans.
Hospitality Insights: As head of M&A, what new opportunities do you see coming from the crisis?
Abbas Rangwala: We are indeed very excited about the opportunities that lie ahead of us in the international hospitality space. The pandemic has pushed the ‘reset’ button for the sector and has allowed us to craft our portfolio repositioning strategy. We have carefully planned a unique lifestyle offering and will be timing the launch to coincide with the stronger years that lie ahead of us. We plan to fully capitalize on the recovery momentum as well as leverage the current downtime to our advantage.
In terms of inorganic growth opportunities, the pandemic has brought strain on hotel cash flows and shaken investor confidence. With the easy monetary policy and support from governments as well as lenders, the quantum of distressed M&A so far has been significantly lesser than expected during a crisis of this nature. With the worst possibly behind us, there is a large acquisition war chest available with many investors currently who are looking to deploy the same into attractive hotel platforms and we believe differentiated offerings with a strong growth story are well positioned to benefit.
Hospitality Insights: Will you change your focus on domestic or international investments?
Abbas Rangwala: Our hospitality strategy is to leverage our strong footprint both in India as well as internationally and continue to grow both platforms. We are extremely well placed to benefit from the strong market in India through our existing hotels as well as an attractive pipeline of under construction assets. Internationally, as discussed, we are looking to launch a new lifestyle brand and re-position assets in our hotel portfolio which benefit from excellent city centre locations and growth dynamics. There are certain non-core assets, which we may also look to divest in the coming year.
Abbas Rangwala will be speaking in the session on The Debt Market: Reviewing Hotel Financing at the International Hospitality Investment Forum (IHIF).