NCR to top hotel industry growth in next five years
New Delhi: The National Capital Region (NCR) would have the highest number of hotel rooms (17,500) by the year 2017, among all mega cities in India. Evaluating the hospitality sector dynamics of India’s top six cities - Bengaluru, Chennai, Delhi, Hyderabad, Kolkata and Mumbai, a leading real estate consultancy firm said that these cities are expected to see a total of 50,000 new hotel rooms across all categories in the next five to six years. It said that by the end of last year alone, an additional 14,800 fresh keys were on offer. Out of the total expected supply for 2012, 2000 new hotel rooms had already entered the market. Akshay Kulkarni, Regional Director, Hospitality, South and South East Asia,
Cushman and Wakefield , said: “ India’s hospitality sector has been witnessing interest from a variety of
segments ranging from MICE, wellness tourism, spiritual and pilgrimage tourism, apart from the
traditional business
or leisure travel. The demand has been strong from both foreign as well as domestic
tourists. Given the rather diverse nature of demand, the hospitality industry
is also looking at creating adequate products to service the varied tourist requirements.
With the support and initiatives by the governments at various levels, the hospitality
sector is moving towards comprehensive growth.”
The NCR, with a total room supply of
17,500 rooms, is expected to see the highest fresh hotel room supply in the next
five years. Mumbai (10, 200) and Bangalore (9, 400) will also see significant
addition to the existing inventories in the city. The addition of new inventory
will be concentrated in the potential growth areas – especially around airports,
commercial growth corridors, industrial corridors and SEZs. These micro markets
emerged as a result of business centres that were created in these cities due
to growth in IT/ITeS, trade and commerce. These top six cites witnessed an average occupancy rate
(AOR) of 58 percent and an average room rate (ARR) of Rs 5,400 last year. It said that the current
averages record a marginal decline of four percent in AOR and five percent in ARR over the average
of 2011 performance. Chennai recorded the highest AOR of 64 percent for 2012,
followed by Mumbai (61 percent) and Kolkata (60 percent). All the cities witnessed
only a marginal drop in AOR when compared to the previous year. Mumbai and
Kolkata saw the maximum dip in AOR.
A decline in AOR in popular destinations was
due primarily to addition of supply in major cities in 2012. On the other hand,
a moderate slowdown in global economies led many corporations to curtail travel,
while individual travelers have also been cautious due to fiscal uncertainties.
Some other factors that have obliquely contributed to lower AOR are the advancements
in technologies which make real time correspondence faster, easier and more cost
effective and increase connectivity that ensure lesser hours of stay per visit.
A corresponding decline in ARR was noticed as hotel’s tried to ensure occupancy
even at a moderately lower cost. Healthy competition in many of the cities is
leading hotels to create monetarily attractive packages for potential visitors, said the
report prepared by Cushman and Wakefield.
