+91-6006515193, +91-9797991119 malikandromaan@gmail.com

The tourism industry in Kashmir is booming, attracting major hotel franchises and brand owners to this “paradise on earth”. As the sector contributes significantly to the region’s GDP, local hotel and land owners must navigate complex legal agreements to protect their interests. This comprehensive guide examines various types of hotel agreements, including franchise, management, and lease contracts, providing crucial insights for business owners in Kashmir’s hospitality sector.

To read more about this topic, check our article on Rising Kashmir at the following link: Kashmir Hospitality: A Businessman’s GUIDE to Hotel Agreements – Rising Kashmir

Here are some key highlights from the article:

  1. Tourism accounts for 7-8% of Kashmir’s GDP, generating over INR 8000 crores in annual revenue.
  2. Types of agreements covered: Franchise, Third-Party Operation/Management, Hotel Management, Lease, and Joint Development Agreements.
  3. Franchise fees typically include initial fees, royalty fees (3-5% of room revenues), and marketing fees (1-2% of total revenue).
  4. Third-party management fees usually range from 4-6% of total revenues.
  5. Hotel Management Agreements often include base fees (2-4% of gross revenue) and incentive fees (4-8% of Gross Operating Profit).
  6. Performance tests in management agreements allow owners to terminate contracts if operators underperform.
  7. Lease agreements offer stable income for owners but less control over operations.
  8. Joint Development Agreements (JDAs) allow landowners to partner with developers to construct hotels without significant financial investment.
  9. Local hotel owners in Kashmir have leverage in negotiations due to high demand for hospitality services.
  10. The article emphasizes the importance of thorough investigation, evaluation, and negotiation of legal agreements in the evolving hospitality industry.

Disclaimer

The Bar Council of India does not permit advertisement or solicitation by advocates in any form or manner.

By accessing this website, www.malikandromaan.com, you acknowledge and confirm that you are seeking information relating to Malik & Romaan Law Offices of your own accord and that there has been no form of solicitation, advertisement or inducement by Malik & Romaan Law Offices or its members. The content of this website is for informational purposes only and should not be interpreted as soliciting or advertisement. No material/information provided on this website should be construed as legal advice.

Malik & Romaan Law Offices shall not be liable for the consequences of any action taken by relying on the material/information provided on this website. The contents of this website are the intellectual property of Malik & Romaan Law Offices.