OYO Hotels & Homes has committed to invest $300 million (about Rs 2,087 crore) over the next few years in the United States, the SoftBank-backed hospitality chain announced on Wednesday, signalling its intent to expand its presence in the world’s largest consumer market.
This will also be one of the largest investment commitments to a particular geography by the six-year-old company, which has stated that it will invest $600 million in China, and an additional $200 million in India – both of which it refers to as its two home markets. In an official statement, the company stated that the investment in the US will be primarily used to double down on growth in the region, talent acquisition, competency building, and infrastructure development.
On Wednesday, the Ritesh Agarwal-led company announced that it currently operates over 50 properties in 35 cities, spread across 10 states in the US, a list that includes, Dallas, Houston, Augusta, Atlanta and Miami. The news of OYO’s investment commitment to the US market was first broken by Bloomberg.
OYO, which claims to have already generated about 1,000 jobs in the US, through its launch in the country, will operate its two of its flagship brands – OYO Hotels and OYO Townhouse – and is targeting entering New York, Los Angeles and San Francisco. It, however, did not provide a timeline for entering these markets.
“As a full-scale hotel chain, we strive to bring real value to both real estate owners and guests – and we’re convinced there is unlimited potential for rapid growth in our newest home market, the United States,” Agarwal said in the company-issued release.
The US is the latest new market for the company, which has been rapidly expanding its presence across the globe. Apart from China and India, it is also present in the United Kingdom, Europe, Indonesia, Malaysia, Nepal, United Arab Emirates, Saudi Arabia, Philippines and Japan.
“We are in the largest country in the world when it comes to the hospitality industry and there is a definite need here for chic and comfortable hospitality experiences at prices never thought of before,” Abhinav Sinha, chief operating officer at OYO Hotels & Homes, said in the statement.
The announcement comes a little less than three months after the company confirmed an investment by US-based home sharing giant Airbnb, a transaction that took its latest equity financing round to about $1.2 billion, valuing it at about $5 billion in the process.
As per the latest data shared by the company, it currently operates about 20,000 buildings, spread across its various brands, with 700,000 keys under management.
The company’s Chinese business has already eclipsed that of its domestic market- India. Last month, the company announced that OYO Jiudian, its Chinese subsidiary, was present in 320 cities, and had about 10,000 hotels and 450,000 rooms under management.
In India, OYO is present in over 259 cities, has over 8,700 hotels and homes, which includes over 173,000 rooms, according to data shared by OYO. Its portfolio includes six brands – OYO Rooms, Townhouse, SilverKey, Collection O, Capital O and Palette Resorts.
The company, which also counts venture capital firms Lightspeed Ventures and Sequoia Capital, ride-hailing majors Grab and Didi Chuxing, Greenoaks Capital, Hero Enterprise and China Lodging Group among its list of institutional backers, claims to be the world’s sixth-largest chain of hotels, homes and living spaces.