Kathmandu Celebrates The Spectacular Comeback Of The Iconic Annapurna Hotel

Published on October 5, 2024

The historic Annapurna Hotel, once a beacon of luxury on Kathmandu’s Durbar Marg, is set to make a grand comeback after closing its doors in December 2020 due to crippling financial losses brought on by the pandemic’s devastating impact on tourism. This iconic hotel, which was once synonymous with hospitality in Nepal, is now preparing for a relaunch in an entirely new form, promising to reclaim its prestigious position in the industry with a modern twist.

On Thursday, Annapurna Square Pvt Ltd took a significant step forward by signing a management contract with ITC Hotels, one of India’s leading names in luxury hospitality. This strategic partnership aims to redevelop the Annapurna Hotel site into a state-of-the-art five-star property. ITC Hotels, known for its commitment to excellence, will oversee the operation of the new hotel, ensuring a blend of world-class amenities and Nepali cultural heritage. The collaboration signifies a new chapter for both the Annapurna brand and Nepal’s hospitality landscape.

The redevelopment project is set to be a monumental one, with an estimated investment of Rs8 billion. Once completed, it will stand as Nepal’s largest hotel, boasting 363 luxurious rooms, including 30 serviced apartments designed to cater to long-term guests. The hotel’s infrastructure will feature two towering buildings—one with 24 stories and the other with 15 stories—bringing a modern architectural presence to Kathmandu’s skyline while offering panoramic views of the surrounding city and mountains.

Beyond accommodations, the new Annapurna Hotel will become a hub for both business and leisure. It will offer four expansive conference spaces designed to host international conferences and events, making it a prime destination for global business travelers. In addition, the hotel will feature a shopping arcade, providing guests with high-end retail experiences, and an entertainment zone, ensuring a vibrant and engaging environment for all visitors.

This ambitious project signals a major shift in Nepal’s hospitality industry, reaffirming Kathmandu as a key player in the global tourism market. The relaunch of the Annapurna Hotel under ITC’s management is poised to elevate the standards of luxury hospitality in the region, attracting tourists and business travelers alike while revitalizing the country’s post-pandemic tourism economy.

Annapurna Square Pvt Ltd will maintain a dominant stake in the redevelopment project, holding 85 percent ownership, while Hotel Del’ Annapurna Pvt Ltd will retain the remaining share. This strategic partnership paves the way for a collaborative effort to bring the iconic hotel back to life, ensuring its future as a premier destination in Nepal’s hospitality sector.

In addition to transforming the city’s tourism landscape, the project will play a vital role in boosting the local economy by creating employment opportunities for approximately 1,500 people. This large-scale initiative underscores the potential for significant economic impact, providing jobs and supporting the broader community as the hotel reopens with a renewed focus on luxury and service excellence.

Originally established in 1965 as the Hotel de l’ Annapurna, the once-renowned 149-room property holds 44 ropanis of prime land (equivalent to 22,385 square meters) in the bustling heart of Kathmandu. Following its closure, the hotel grounds were repurposed into a parking lot. However, with the relaunch on the horizon, company officials have revealed plans to incorporate three underground parking levels as part of the redevelopment. Given the high demand for parking in space-constrained Kathmandu, this addition is seen as a valuable business opportunity, adding a modern touch to the historic site’s transformation.

Rana expressed optimism that, despite the numerous challenges Nepal’s hospitality industry has faced, there is hope for its resurgence. In 2023, Nepal’s tourism sector experienced a significant rebound, surpassing the 1 million visitor mark for the year. This achievement represents a crucial milestone in the country’s efforts to revive the tourism industry, which had been severely impacted by the Covid-19 pandemic.

However, experts point out that natural disasters, as well as frequent plane crashes and bus accidents, have hindered the industry’s growth potential. According to the annual report by the World Travel and Tourism Council, Nepal’s tourism sector contributed Rs327.9 billion ($2.5 billion) to the economy in 2023, directly and indirectly supporting 1.19 million jobs. The report forecasts that this number will increase to 1.22 million jobs in 2024, accounting for 15.2 percent of the total workforce.

The tourism sector’s contribution to Nepal’s GDP stood at 6.6 percent in 2023, generating Rs358.9 billion ($2.7 billion), slightly down from the 6.7 percent recorded in 2019, before the pandemic. Despite the challenges, Nepal’s post-Covid tourism landscape has seen the emergence of several luxury hotels, indicating renewed investment in the industry. Gurung, who recently entered the hospitality sector, emphasized that his decision to do so was driven by passion for the field.

India has long been Nepal’s leading tourist source market, with 319,936 arrivals recorded last year, marking a significant contribution to the country’s tourism industry.

Co-founder of Bhat-Bhateni Supermarket, Nepal’s largest retail chain and most popular marketplace, recognized the immense potential of the tourism sector to generate employment and decided to enter the industry.

What began as a modest grocery store in 1984 was transformed into a thriving retail empire through visionary leadership and entrepreneurial drive. The retail business was built on a commitment to maintaining high standards and ensuring customer satisfaction, laying the foundation for long-term success.

Annapurna Square Pvt Ltd has partnered with ITC Hotels, a leader in luxury hospitality in India, to manage the redevelopment of the iconic hotel. This marks ITC Hotels’ second international venture in Nepal, following the establishment of Fortune Resort & Wellness Spa in Bhaktapur.

Staying true to ITC Hotels’ philosophy of ‘responsible luxury’ and sustainability, the new Annapurna Hotel will incorporate eco-friendly practices, including energy-efficient technologies and the use of locally sourced materials. The project is being positioned as a historically inspired restoration rather than a complete redesign, honoring the legacy of the original hotel.

The redevelopment will also focus on bolstering Nepal’s economy by employing local artisans and prioritizing Nepali products. Morphogenesis, a renowned Indian architecture firm, has been tasked with realizing this vision, ensuring the new hotel reflects both modern sophistication and the cultural heritage of Kathmandu.

Known for its forward-thinking designs and commitment to sustainability, Morphogenesis aims to transform the Annapurna Hotel into a harmonious blend of contemporary luxury and traditional Nepali influences, setting a new standard in the region’s hospitality scene.