India's luxury hotels in a flux as growth slows

[MUMBAI] Less than nine months after opening the first hotel in Mumbai under its brand, Hong Kong luxury chain operator Shangri-La Asia handed the keys back to the owner.

Now, US-based Starwood Hotels & Resorts Worldwide is in talks with the same owner to take over management of the property under its St Regis brand, sources said, part of a shakeout at the luxury segment of India's ailing hotel industry.

Slowing economic growth and an oversupply of new hotels conceived during the boom years of 2006 and 2007 have led to falling room and occupancy rates in India, straining relationships between hotel owners and the global chains brought in to run them.