The Hindu Business Line : Hospitality industry upbeat in Bangalore

COME February, luxury hotels in Bangalore are expected to be fully booked, resulting in delegates commuting from Chennai for the biennial Aero India show.

The bookings have already reached the saturation point. Though the hospitality industry might be rejoicing at the bonanza, the concern over consolidating the growing opportunity was very much evident.

"Though not disturbing that the neighbouring States would be garnering business, the hotel industry has to worry about the future and increase room inventory to meet the growing demand for rooms," said Mr Lempel Herbert, General Manager, The Park, Bangalore.

Though a few leading hotels are understood to have firmed up their plans for expansion, steady growth in demand could be met only if the industry builds up an additional inventory of 1,600 to 1,700 rooms to the current 1,200 to 1,300 rooms, in the next 18 months, said Mr Herbert.

The city will be hosting major events between December and February such as a conference by the Indian Cardiologists Society of India and the biennial Aero India show.

The Aero India show, which attracts leading civil and defence aviation industries across the globe, has been coming to the hospitality industry in the last few years. And yet the luxury hotels did not have a stable growth due to the recession and slow-down in the information technology sector. However, with the sudden recovery in both IT and the manufacturing sector in the last three years, MNCs have given a boost to the hotel industry with rooms booking on a long stay basis. This had reduced the room availability, as 15 to 20 per cent of the rooms in leading luxury hotels were booked for long stays of 15 to 25 days against the normal industry average of two to three nights.

Bangalore, which has yet to emerge as a major tourist hub like Delhi or Mumbai, does not suffer from the seasonality for room demand. It gets business throughout the year, except December, when international companies go on long Christmas vacation, said Mr Herbert.

He said the boom in serviced apartments which attracted clientele for long stays in suites and rooms, would not pose any competition to the luxury hotel's new segment of `long stays' as the former catered to requirements of stays of four to five months. Mr Herbert said the buoyancy from the corporate clients has also helped the hotels improve their bottomline, with food & beverages and trendy bars yielding much higher turnover than in the past three years. The average room occupancy rates have also gone up to 70 to 80 per cent as against 50 to 60 per cent two years ago.