Why mixed-use developments could drive the next phase of luxury city hotels

Risk diversification for developers

These types of mixed-use developments are especially useful when land is expensive or scarce and developers can build hotels that are vertical and integrated with other assets. “In places like Punjab, where real estate is quite expensive, entrepreneurs often build and sell the retail portions of the complex first, hedging their bets and spreading the risk,” said Ajay K. Bakaya, chairman of Sarovar Hotels and director of Louvre Hotels India. “We operate a lot of mixed-use properties in major cities. Sometimes these are three- to four-storey hotels stacked atop retail or business centres. We are present in these formats in Bengaluru, Delhi and Ghaziabad.”