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Aligning Interests of Operators  Investors and Developers and The Government of India’s Important Role Skip Conover Chairman, Bhavana Developers Pvt. Ltd. November 22, 2007 [email_address]
USA India Properties: 47,135 1,899 Rooms: 4,389,443 107,392 Population: 301 Million 1.129 Billion Sales 2006: US$133.4 Billion Occupancy Rate: 63.3% Rooms Occupied/Night:  2,778,517 Total Hotel Rooms in the USA in 1900:  750,000 USA Population in 1900:   76.1 Million Sources:  American Hotel & Lodging Association 2007 based on 2006 numbers.   HVS Study 2005-2006
#1  MGM Grand 5,034 #4  Circus Circus 3,800 #5  Mandalay Bay 3,700 #8  Mirage 3,049 #9  Venetian 3,036 #10  Monte Carlo 3,014 #11  Bellagio 3,000 #26  Riviera 2,072 Total for only these 8 hotels:    26,705
19,935 Source:  HVS Study 2005-06
India:  107,392 Source:  HVS Study 2005-06
USA 1900: 1 Room per 101 People USA 2006: 1 Room per 68 People India 2005-06:  1 Room per  10,512  People How many hotel rooms are right in a modern economy? How many rooms does India need to build? Source:  American  Hotel and Lodging Association 2007 and  HVS Study 2005-06
1. What do you think? 2. Who will do it? If that were accomplished, there would be  1 hotel room for every 5,256 Indians.  Is that enough?
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Source:  2007 CIA World Factbook India Compared to other Economies
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--That’s an artificial construct comforting to economists and politicians, but of  very  little use to a peasant farmer living on $2 per day! --The actual per capita GDP spread is on the order of: --India--$670 --China--$2,000 --USA--$43,000 --When we take away the PPP, what shows up as the reason India is doing relatively well is that many commodities cost less in India than other countries, thereby skewing PPP results.  --BUT, the Global Economy is tending to even out all pricing inefficiences,  which means that the PPP advantage is going to evaporate! --Just consider what’s happening to IT companies to see   the future in all commodities!!!
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
 
Sounds like a LOT of money! --BUT actual GOI statistics say that the total FDI into India 8/91 ~ 7/07  (Sixteen Years!)   was $60.3 Billion, and only 2.25% of that was for Housing and RE Remember:  FDI into China in the last ONE YEAR was $72 Billion!!! Meanwhile:  3,400 projects are underway in the Middle East at a total value of $2.4 trillion, a region where the population is only 25% of India’s
 
 
Look to your left and right, and decide for yourself  whether this conference will accelerate FDI into India. Today is the American Thanksgiving Holiday!  All of the top people in American investment banks are  HOME WITH THEIR FAMILIES! Globally “sophisticated” players simply MUST get smarter about the Global Economy and what it means for your future!
Aligning the Interests of  Operators, Investors and Developers  means to me the necessity to properly and respectfully convey this message to the Government of India, so that the appropriate handcuffs can be removed from India’s Economy, before it is, quite frankly TOO LATE!

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Presentation to India Hotel Conference

  • 1. Aligning Interests of Operators Investors and Developers and The Government of India’s Important Role Skip Conover Chairman, Bhavana Developers Pvt. Ltd. November 22, 2007 [email_address]
  • 2. USA India Properties: 47,135 1,899 Rooms: 4,389,443 107,392 Population: 301 Million 1.129 Billion Sales 2006: US$133.4 Billion Occupancy Rate: 63.3% Rooms Occupied/Night: 2,778,517 Total Hotel Rooms in the USA in 1900: 750,000 USA Population in 1900: 76.1 Million Sources: American Hotel & Lodging Association 2007 based on 2006 numbers. HVS Study 2005-2006
  • 3. #1 MGM Grand 5,034 #4 Circus Circus 3,800 #5 Mandalay Bay 3,700 #8 Mirage 3,049 #9 Venetian 3,036 #10 Monte Carlo 3,014 #11 Bellagio 3,000 #26 Riviera 2,072 Total for only these 8 hotels: 26,705
  • 4. 19,935 Source: HVS Study 2005-06
  • 5. India: 107,392 Source: HVS Study 2005-06
  • 6. USA 1900: 1 Room per 101 People USA 2006: 1 Room per 68 People India 2005-06: 1 Room per 10,512 People How many hotel rooms are right in a modern economy? How many rooms does India need to build? Source: American Hotel and Lodging Association 2007 and HVS Study 2005-06
  • 7. 1. What do you think? 2. Who will do it? If that were accomplished, there would be 1 hotel room for every 5,256 Indians. Is that enough?
  • 8.
  • 9.
  • 10.  
  • 11. Source: 2007 CIA World Factbook India Compared to other Economies
  • 12.
  • 13.
  • 14. --That’s an artificial construct comforting to economists and politicians, but of very little use to a peasant farmer living on $2 per day! --The actual per capita GDP spread is on the order of: --India--$670 --China--$2,000 --USA--$43,000 --When we take away the PPP, what shows up as the reason India is doing relatively well is that many commodities cost less in India than other countries, thereby skewing PPP results. --BUT, the Global Economy is tending to even out all pricing inefficiences, which means that the PPP advantage is going to evaporate! --Just consider what’s happening to IT companies to see the future in all commodities!!!
  • 15.
  • 16.  
  • 17. Sounds like a LOT of money! --BUT actual GOI statistics say that the total FDI into India 8/91 ~ 7/07 (Sixteen Years!) was $60.3 Billion, and only 2.25% of that was for Housing and RE Remember: FDI into China in the last ONE YEAR was $72 Billion!!! Meanwhile: 3,400 projects are underway in the Middle East at a total value of $2.4 trillion, a region where the population is only 25% of India’s
  • 18.  
  • 19.  
  • 20. Look to your left and right, and decide for yourself whether this conference will accelerate FDI into India. Today is the American Thanksgiving Holiday! All of the top people in American investment banks are HOME WITH THEIR FAMILIES! Globally “sophisticated” players simply MUST get smarter about the Global Economy and what it means for your future!
  • 21. Aligning the Interests of Operators, Investors and Developers means to me the necessity to properly and respectfully convey this message to the Government of India, so that the appropriate handcuffs can be removed from India’s Economy, before it is, quite frankly TOO LATE!