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Our Bureau

Bangalore, Oct. 7

Prospects remain positive for Bangalore’s hotel and tourism industries in the coming years, what with more than 6,400 hotel rooms expected to be added in the next couple of years, including international hotel offerings from The Ritz-Carlton, Shangri-La and JW Marriott, says India Digest 2008 by Jones Lang LaSalle Hotels, global hotel investment services firm.

“In view of the substantial planned room additions, we expect occupancies to dip as evident from the trend in 2007. We forecast occupancies to stabilise around 65-70 per cent in the next five years with daily room rate averaging at Rs 16,000,” the report adds.

The tourism industry in Bangalore, which receives more business travellers than leisure tourists both from the international and domestic markets, is set for further growth supported by improvements made to the tourism infrastructure and the continued growth in inbound arrivals.

Given its strategic location as a key gateway, particularly for domestic tourists, to the World Heritage sites and historical locations in the State, Bangalore is in a good position to further expand its leisure tourism potential, says the report.

Besides, the city is also aiming to become a healthcare hub by 2011, with heavy investments by the Manipal Group, Wockhardt and Columbia Asia to increase the number of hospital beds in the city.

The MICE segment has the potential to grow, provided plans for the proposed International Convention Centre near the new airport materialise, says the report. Financial year 2006-07 saw a 46 per cent increase in international passenger traffic to Bangalore over 2005-06.

According to the report, this uptrend is expected to continue into FY2007-08 — with a 37 per cent year-on-year increase in international arrivals to one million during the April-November 2007 period.

Similarly, the domestic market is expected to register strong growth in 2007-08, with a 33.5 per cent year-on-year increase in domestic passengers at the airport during the first eight months of the financial year to 5.6 million.

The city’s five-star deluxe and five-star hotels enjoyed another robust year as demand continues to exceed supply, says the report. “ADR saw a 16 per cent increment in 2006-07 to Rs 16,000.

Due to the addition of rooms in 2007, occupancy dropped two percentage points to 74 per cent. Led by growth in room rates, Revenue Per Available Room (RevPAR) strengthened by 13 per cent year on year to a seven-year high of Rs 12,000,” it adds.

With large new supply anticipated in 2008 and with room demand expected to remain strong, RevPAR growth is expected to be driven by ADR growth in 2008-09, according to the report.

The anticipated addition of about 3,700 new rooms in 2008 and 2009 is expected to alleviate the current short supply, “however the resultant increase in competitive pressures within the market could lead to some rationalisation in ADR growth rates,” it says.

More Stories on : Hotels | Tourism | Karnataka

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