Small-town India becoming a big draw for major hospitality players

With saturation in tier 1 metro cities, top hospitality players in the country are increasingly looking at India’s tier 2 and 3 cities.

With saturation in tier 1 metro cities, top hospitality players in the country are increasingly looking at India’s tier 2 and 3 cities. As per a 2022 report, ‘The Evolving Face of Human Capital in the Hospitality Industry’, which is a joint survey by JLL and The People Network, there has been a significant shift in hotel supply, with about 43% of planned pipeline falling in tier 2 and 3 markets.

“Going by the number of keys opened last year, 67% were in tier 2 and tier 3 cities,” Mr.Piyush Agarwal, managing director, hotels & hospitality group, India, Foxoso, said. “In terms of fresh projects signed in 2022, approximately 75% keys will come up in tier 2 and 3 towns. It is important to note that some part of this inventory would be conversions of unbranded hotels into branded managed and franchised hotels,”