The US-based Laxmi Franklin Hospitality Private Limited will set up two budget hotels at Bhubaneswar and Puri at an estimated cost of Rs 20 crore (Rs 200 million).
The company's vice-chairman, KC Mohapatra, signed a memorandum of understanding to this effect with the state tourism secretary Ashok Tripathy recently.
The combined room capacities of both the properties will be 200 rooms.
The projects will be completed in one year, Mohapatra said.
Laxmi Franklin Hospitality Private Limited, is promoted by NRI businessman Sharad M Patel, who is currently running 12 motels with more than 900 rooms in Tennessee and Kentucky provinces of the USA.
Mohapatra said the company's net worth is approximately $30 million and its annual turn over is $40 million.
Though it will set up two budget hotels at Bhubaneswar and Puri in the first phase, it intended to expand its operation in the state later by setting up similar budget hotels at Paradip, Duburi and Jharsuguda, where a number of steel plant projects are proposed to be located.
The state tourism minister Surya Narayan Patro, who was present at the MoU-igning function, said the state government was encouraging establishment of big and budget hotels in order to promote tourism.
The occupancy rate in the hotels in the state has gone up to 40 per cent this year from last year's 17 per cent as a result of the government's policy to boost hospitality industry.
He informed that Tata Group had recently signed a MoU to set up budget hotel at Bhubaneswar under the IndiOne brand and the construction had already started.
Patro said, the new investors, Laxmi Franklin Hospitality, has requested the government to provide suitable land at market price in Bhubaneswar and Puri.As soon as the land was allotted, foundation stone of the hotel project would be laid and construction work would be taken up on the same day.