Chennai, Aug 27 () : Leela Palace Chennai, the newest luxury hotel, situated on the southern end of the Marina beach, will open early November, just in time to cash in on the peak-season demand.
Inspired by Chettinad Palace nearby, it is being readied to welcome guests. Sea-facing, the hotel from Hotel Leela Venture Ltd has 326 rooms. Deluxe sea-facing room rates at the 326-room property, as per a web booking engine, start at Rs 12,500 per night, while Taj’s Lands End, a prime sea-facing hotel in Mumbai charges only Rs 11,700 per night.
The hotel was delayed by over a year. The launch of the eighth hotel, the Leela Palace Chennai turnaround attempt by promoters is expected to reduce the debt. The balance sheet as of March 31, showed a total debt of nearly Rs 4,300 crore, with fourfold rise in net loss at Rs 101 crore in the first quarter this fiscal.
Captain Krishnan Nair and family initiated a series of measures to tide over the crisis by assuring stakeholders of reduction in its debt. 64 per cent of the revenue earned (Rs 138 crore) during the the January-March quarter (Rs 89 crore) went as interest.
To meet expenditure for renovation,capital expenditure, expansion, brand building and to pursue new growth opportunities, the company will have to raise up to Rs 1,000 crore through one or more instruments.
Under the corporate debt restructuring (CDR) mechanism, Leela to ease out the debt burden, expects to get moratorium on interest and principal repayments for two years and repayment over the next eight years since most of its debts are payable in next five years.
The CDR EG (empowered group) in May with January 1, 2012 as the cut-off date approved a flash report. The lenders have not agreed to reduce the interest rate on outstanding loans and discussions on the final restructuring package is under way.
The annual report of Hotel Leela Ventures say the lenders would have a right of recompensation at the time of exit from CDR if it gets reduction of interest rate.