Briefs: $500M jv to invest in Europe; Indonesia tourism overview

CPP Investments, Hamilton-Pyramid Europe create JV: Canada Pension Plan Investment Board (CPP Investments) and London-based Hamilton-Pyramid Europe have announced a new joint venture focusing on the hospitality sector in Europe. CPP investments has committed €475 million (US$481.63 million) to the joint venture. The Real Estate group at CPP Investments has C$49 billion (US$37.9 billion) worldwide in properties. With initial equity commitments of €500 million (US$506.98 million), the jv will acquire operating hotels in key gateway cities and select resort destinations across Europe. The partners will be able to increase allocations in light of market opportunities and allow the venture to grow to scale at pace.

Banyan Tree in June opened the Buahan, a Banyan Tree Escape, with 16 villas in the untouched part of northern Ubud, Bali, Indonesia.

Indonesia tourism overview: The tourism and hotel sector in Indonesia is slated to grow by US$21.93 billion during 2022-2026, expanding at a CAGR of 11.81% in the forecast period, according to the latest report by One of the most significant drivers for the market is the increasing preference for local and authentic experiences. One of the prime reasons driving the country’s tourism and hotel market growth in the next few years is the increasing volume of foreign tourists. The report provides an analysis, forecast and market size and vendor analysis based on 25 vendors.

Britannia Hotels acquires Glasgow Premier Inn: Britannia Hotels, Altrincham, England, has acquired the 278-key Premier Inn Glasgow for £8.5 million (US$10.2 million) from the U.K.-based Whitbread. This addition will be Britannia’s 64th and brings its room count to around 12,300. Whitbread is reconfiguring its chain of hotels in Glasgow after the opening of the 249-key Premier Inn and Bar + Block restaurant last June. The deal was arranged by Christie & Co.

Global deal activity dips: With 73 deals being announced in the global travel and tourism sector this July, sector deal activity fell by 39.2% compared to 120 deals that were announced in June, according to GlobalData. Most of the key global markets saw a decline in deal activities in July. Markets like the U.S. and the U.K. reported a fall of 51.3% and 42.1%, respectively, in deal volume in July compared to June. Deal activity also remained depressed for markets like India, Spain, France, Germany and China. Announcements of mergers and acquisitions, venture financing and private equity deals declined in July. The number of M&A deals dipped by 42.9%, venture financing by 37.5% and private equity by 16.7% in July.

Sri Lanka’s outlook: The travel and tourism sector in Sri Lanka, a significant income generator, has been jeopardized by the ongoing economic crisis, the Russia-Ukraine conflict and China’s zero-COVID policy, GlobalData reported. Tourism accounted for over 12% of the country’s GDP in 2019 and the third-largest source of foreign exchange reserves. International arrivals in Sri Lanka more than quadrupled from 448,000 to 1.9 million between 2009 and 2019, touching a record high of 2.3 million in 2018. Simultaneously, inbound tourism spending jumped from US$394.4 million in 2009 to US$3.6 billion in 2019, with a high of US$4.4 billion in 2018. The Easter bombings in 2019 first struck a blow to Sri Lanka’s travel and tourism sector as international arrivals slipped 18% YOY and tourist expenditure declined by 17.7% YOY. This was immediately followed by two years of COVID-19 restrictions with inbound visitors in 2021 dropping to 116,600, or 6% of pre-pandemic levels, and inbound tourism expenditure falling to US$213.1 million. The Russia-Ukraine war is expected to create an absence of tourists and international spending from these two nations for the foreseeable future.

Indian scheme for hospitality sector: India has announced an enhancement of INR50,000 crore (US$6.25 billion) to its emergency credit line guarantee scheme (ECLGS) exclusively to boost the country’s ailing hospitality and travel and tourism sector with working capital loans. With this enhancement, the total outlay under the ECLGS now amounts to INR5 lakh crore (US$62.56 billion). The government has announced it will provide additional loan guarantee cover of INR7,500 crore (US$938 million) for the newly announced scheme, which is intended to extend working capital loans for all types of businesses in the hospitality and travel and tourism industry and the MSME players in the sector.