SoftBank-backed Indian budget hospitality brand OYO has found its sixth international market, the United Arab Emirates (UAE). The company has made about 1,100 rooms operational in three of the seven Emirates, including Dubai and Sharjah.
The five-year old start-up, which recently raised $1 billion from investors including SoftBank, plans to have 12,000 rooms in the UAE by 2020, which also coincides with the World Expo 2020 being held in Dubai.
OYO has been doing pilots in the UAE for the last few months, and officially launched the brand on Saturday. Besides India, its biggest market, OYO now operates in China, the UK, Malaysia, Indonesia, Nepal and the UAE. India and China happen to be its biggest markets in terms of presence.
“With a string of over ten full-inventory-franchised and operated hotels and over 1,100 rooms in three Emirates — Dubai, Sharjah and Fujairah, OYO Hotels is ready to offer the benefits of its full-stack technology led hospitality model to hoteliers across the country, with room rates starting 150 dirhams (Rs 3,000 approximately),” the company said.
OYO plans to have a total of 12,000 rooms in 150 hotels across the seven Emirates, by 2020. Ritesh Agarwal, the 24-year old founder and Chief Executive Officer of OYO, said the UAE offers a strong growth opportunity.
“With over 170 countries committing to the World Expo 2020, the hospitality sector in the Middle East, and more specifically the UAE, is poised to grow substantially. We are ready to tap this opportunity. We have been at the forefront of the budget and mid-segment hotels revolution in the markets we operate in, and can bring in our operational expertise and technology edge to the benefit of independent hotel owners”.
The company will operate UAE properties under the manchise model implying a lease with full inventory control, similar to the model in India and China.
“These hotels will provide affordable and trusted living options for travelers from GCC countries, India and other International tourists, including business and leisure travellers”, the company said. Agarwal said the bookings for UAE will be facilitated by the company’s partnerships with global online travel companies like Booking.com and Expedia.
The fact that large groups of customers from China and India visit the UAE will enable us to offer bookings on our own platforms, he said.
“We are proud that our first hotel OYO hotel 101 Dubai is now at 85 per cent occupancy and we are seeing similar results for the market which is much higher than market benchmarks showing that top quality at fair price will rapidly drive yields in our assets,” he added.
OYO started its journey in May 2013 with one hotel in Gurugram and now has 270,000 rooms under management, spread over more than 12,000 hotels in seven markets. Of these, about 133,000 rooms are in India, followed by 129,000 in China, the top two markets.
- The UAE is OYO’s sixth international market
- OYO raised $1 billion last month at a valuation of $5 billion
- Apart from India, the firm operates in China, the UK, Malaysia, Indonesia, Nepal and the UAE
- india and China remain its biggest markets