Omaxe’s ₹6,200-crore hotel expansion to be funded by project sales, says MD Mohit Goel

Real estate developer Omaxe will fund its planned ₹6,200-crore hospitality expansion primarily through sales proceeds from the respective developments, limiting its dependence on external borrowing, Managing Director Mohit Goel said. The company plans to build 19 hotels across 13 cities in five states over the next four to five years, with the hospitality business expected to generate around ₹1,000 crore in annual revenue once the portfolio stabilises.

“Omaxe follows a sale-led development model across its projects, and the hospitality portfolio will primarily be funded through sales proceeds from the respective developments,” Goel told Fortune India. The approach will allow the company to align capital deployment with project execution, he said, adding that Omaxe does not currently plan to rely on debt for project completion, although construction loans may be considered if required.

The proposed investment will be deployed in phases, depending on project progress and the requirements of individual developments, he said.

Announced in June 2026, the hospitality plan covers nearly 5 million sq. ft. across urban centres, pilgrimage destinations and transit corridors, subject to project-specific and regulatory approvals and market conditions.

Of the 19 hotels, 12 are planned in Uttar Pradesh, including two each in Ayodhya, Kaushambi and Vrindavan, and three in Lucknow. The company also plans properties in Prayagraj, Ghaziabad and Gorakhpur. Its expansion will extend to New Delhi, Faridabad, Ujjain and cities in Punjab and Chandigarh, including two hotels in Chandigarh.

Eyes high single-digit to low double-digit returns

Omaxe expects returns from its hospitality portfolio to range from high single digits to early double digits, depending on market conditions and individual property performance. “Based on current projections, Omaxe expects occupancy levels of around 60-80%, depending on the market and property, with indicative average room rates ranging from ₹6,000 to ₹12,000 per night,” said Goel.

He added that performance will vary by location, seasonality and hotel category, with higher-category properties expected to command stronger room rates and returns.

The portfolio will target multiple demand segments, including religious tourism, business travel, leisure, destination weddings and MICE - meetings, incentives, conferences and exhibitions. The company plans a mix of midscale and upscale branded hotels, luxury and premium properties, pilgrimage hotels, serviced apartments and extended-stay studios.

The company expects the hospitality business to generate approximately ₹1,000 crore in annual revenue once the portfolio stabilises, based on current business assumptions and subject to execution, occupancy levels and market conditions. Its contribution to profitability is expected to build progressively as hotels open and stabilise, Goel said.

Omaxe expects to complete all 19 hotels over the next five years, with some properties targeted to commence operations within the next 12 months. The projects are at different stages of development and will be commissioned in phases.

Branded hotel partnerships in the works

Omaxe is in advanced discussions with domestic and international hospitality operators for branding and management partnerships. Formal announcements will follow once definitive agreements are finalised.

One of the key projects is a 158-key Gateway Hotel by Indian Hotels Company Ltd (IHCL) at The Omaxe State, the company’s 50.4-acre integrated destination in Dwarka, New Delhi. The project is being developed under a public-private partnership with the Delhi Development Authority. Omaxe is also planning transit-oriented hospitality infrastructure through public-private partnerships with the Uttar Pradesh State Road Transport Corporation.

The company sees the expansion as an extension of its existing townships, mixed-use developments and commercial destinations. Improving connectivity, religious tourism and travel across emerging urban markets are among the demand drivers it expects to support the hospitality business.