Russia's luxury hotels eye Indian hospitality firms for revival plans

Following the withdrawal of international brands like Ritz Carlton, Four Seasons, and Park Hyatt from Russia after its invasion of Ukraine, the country's top luxury hotels are seeking partnerships with leading Indian hospitality firms to manage their properties, according to a report by Mint. Russian officials have reportedly approached Tata Group's Indian Hotels Co Ltd (IHCL), which operates Taj luxury hotels, and East India Hotels (EIH), known for The Oberoi hotels, regarding potential collaborations. However, reports indicate that neither IHCL nor EIH has shown significant interest in pursuing these offers.

The departure of Western hospitality giants from Russia has left a void in the market, leading to the disconnection of luxury properties in Moscow and St. Petersburg from their global networks. Consequently, these hotels have lost access to international distribution systems and management expertise.

Additionally, there are ongoing construction projects for new luxury hotels seeking branding and global distribution, as well as mid-scale properties across the country in need of hotel operators.

Despite the absence of branded hotels, Moscow boasts over 19,000 accommodation facilities. However, travellers seeking accommodation at these former international brand hotels may need to bypass booking aggregators and instead directly visit the hotels' websites for reservations.

As India is a priority market for Moscow, to enhance tourism cooperation, representatives from Moscow have also encouraged Indian online travel platforms to promote awareness and facilitate tour packages for Indian travellers. Recently, the Russian government also introduced more e-visas for 55 foreign states, including India.

Amidst this landscape, Lemon Tree Hotels expressed openness to managing luxury properties if the opportunity arises, while Sarovar Hotels & Resorts explored potential deals in Russia but has yet to finalise any agreements, Mint added.

Traditional management contracts and franchising agreements are among the potential collaboration models being explored, offering mutual benefits for both parties.