The Hindu Business Line : Occupancy rates in Chennai hotels ruling high

DESPITE the traditional off-season and increased availability of space, occupancy rates in the city's hotels have been high - between 71 and 80 per cent - for the last two months, according to hotel industry sources.

One of the factors for this is the continued growth of information technology and information technology enabled services, according to Mr Geoff Magee, CEO, The Raintree.

There is general buoyancy in the economy, which is reflected in Chennai too, he said.

The manufacturing and exports sectors are also responsible for the high occupancy rates, sources said.

There has also been increased activity on the real estate front with a number of big real estate developers from Mumbai, Delhi and Bangalore starting operations in Chennai.

Another factor that has contributed to the increased occupancy is that air connectivity has improved in the last one year. There are many low-cost options on the domestic sector, which have resulted in more air passengers. On the international front, Delta has started operations into Chennai while others have increased their frequencies, making corporate travel easier.

There has also been an increased availability of rooms. The Courtyard, a Marriott brand, is set to open in the third quarter of this year. The hotel will have 238 rooms of which some will be apartments. In the last few months, more than 430 five and four-star rooms have come into the market. The 171-room Hotel Green Park was opened in March. This Rs 45-crore four-star hotel in Vadapalani has eight banquet halls.

In April, Shangri-La Hotels and Resorts launched its 162- room Traders brand. An investment of Rs 100 crore has gone into this project.

Late July, there was a soft opening of the 105-room Raintree, an ecotel, developed by Ceebros Property Development Ltd.

Hotel industry sources said the average room rate has been about Rs 5,000 per room night for five star hotels and between Rs 2,500 and Rs 3,200 for three and four-star hotels.

More hotels in the five and four-star category are in the pipeline. Chennai is part of the Leela group's Rs 900-crore expansion plans. The Taj GVK property on Club House Road off Anna Salai is set to open early 2006. Other projects include those from the Empee group and two more ecotels from Raintree.

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