SAMHI Hotels Expands in Hyderabad with Hitec City Lease

New Location Alert: SAMHI Hotels in Hitec City

SAMHI Hotels Limited has announced the addition of a new hotel to its portfolio by signing a long-term variable lease for an Upper Upscale hotel featuring 170 to 175 rooms in Hyderabad. The hotel will be created by converting an office building located on the main arterial road of Hitec City, which is the largest office micro-market in Hyderabad and is surrounded by a high density of Grade A office spaces. The structure has already been completed and offers N270,000 sq. ft. of built-up area. SAMHI will now undertake the fit-out work for the building.

Through this lease agreement, SAMHI is enhancing its market presence in Hyderabad, one of India's largest and fastest-growing office markets. The company currently owns and operates four hotels in Hyderabad with a total of 8,781 rooms across various segments. This new transaction will add 170 to 175 rooms in the Upper Upscale segment, which a prominent international operator will manage.

According to the FY24 financials, revenue from leased assets accounted for 13% of SAMHl's total revenue. This upcoming transaction will assist us in reaching our goal of over 20% revenue contribution from leased assets, which are considerably more capital-efficient. Once completed, the hotel will enhance its portfolio of Upper Upscale and Upscale assets in a key market, following its recent acquisition in Bengaluru.

Commenting on the performance, Mr Ashish Jakhanwala, Chairman & Managing Director, SAMHI Hotels Ltd., said, "I am delighted to announce the signing of a long-term variable lease in Hitec City, Hyderabad. This transaction aligns with our stated strategy of increasing the share of long-term leases for better capital efficiency and higher risk-adjusted returns. We are also proud to have executed one of the first office building conversions to a hotel, which opens up a new avenue for our growth. With a quick conversion of this building to an Upper Upscale hotel, we have secured strong growth for our portfolio."