PUNE: Serviced apartments are fast gaining popularity among individual and corporate visitors intending to stay in the city for long periods. The
concept, which first appeared a decade ago, has today become a strong segment of the city's hospitality sector. From just one property and 27 apartments in 2001, the serviced apartments segment in the city has grown to more than 20 properties and an inventory of over 500 apartments.
Mohammed Aslam, head, Pune at real estate research and advisory company Jones Lang LaSalle Meghraj (JLLM), told TOI that the demand for serviced apartments in the city is being driven primarily by new companies being established in the city. "Many corporates are absorbing manpower from beyond the city's borders and the demand for serviced apartments from transient staff is now very significant. More properties in Pune are adding to their serviced apartment capabilities to meet this demand," Aslam said.
The segment has now broadened as the their offerings are increasing in number, nature and services. While the sizes of the units vary from a studio to a three-bedroom flat, the services range from bed-and-breakfast to full service, including household assistance.
Royal Orchid Golden Suites, promoted by Bangalore-based Royal Orchid Hotels, has 71 studio rooms supported by a multicuisine restaurant and a bar. A drawing room, a well-appointed kitchen and one- to three-bed rooms is, however, the more common format most serviced apartments adhere to.
Real estate firm Naiknavare Developers who run two serviced apartment properties, together comprising 77 units, under the Seasons brand name has gone a step ahead and offered Seasons Luxury Homes. These are much more spacious and lavishly done and are available on rent for medium to long stay. Hemant Naiknavare, director, Naiknavare Developers, said that in India, where limited services (housekeeping and housemaids) are easily available, many small entrepreneurs offer rented, partially serviced, furnished / unfurnished options. Often, Naiknavare said, many long-stay customers of apartment hotels opt for such apartments and move out within a few weeks.
JLLM's Aslam said since April, there has been a marked pick-up in the leasing of serviced apartments and corporate guesthouses in the city. "Even the properties previously put up on the resale or residential rental market by investors are now being converted for such use," he pointed out.
US-based Oakwood Worldwide the only multinational serviced apartments chain present in the city is also expanding. In addition to the 40-apartment Oakwood Premier on Naylor Road, the company is setting up Oakwood Residence, another serviced apartment property comprising 202 units. Priya Nagrani, director of marketing and sales at Oakwood, said there is a strong demand from expat corporate personnel for such options. The expansion of the automobile and IT sectors has seen many foreigners coming to the city for activities such as plant commissioning, she pointed out. Oakwood Premier, for instance, currently houses some 40 expat employees of auto giant Volkswagen.
According to Aslam, there has been a slowdown in hospitality revenue yields in the city. There can be between 20-40 per cent savings on costs at serviced apartments, especially with corporate discounts. Moreover, serviced apartments offer business travellers facilities such as fully-equipped kitchens with self-catering facilities and various bedroom choices. On the pricing side, serviced apartments charge between Rs 6,000 to Rs 11,000 (rack rate) for 4 persons as against the Rs 14,000- upwards tariffs charged by star hotels for two persons.
Sanjay Datta, managing director of realty research firm Cushman & Wakefield said the demand for serviced apartments in the country continues to increase. Corporate travellers, Datta pointed out, express preference for this type of housing over hotels owing to its cost effectiveness and added facilities such as a fully-equipped kitchen, self-catering facilities, choice of bedrooms, lounge and relaxation areas and access to leisure facilities. Corporate travellers can thus enjoy the amenities of a five-star hotel while living a more flexible lifestyle.
"Another cost-effectiveness factor is that in serviced apartments, occupants save on the bar bills, inflated internet and telephone charges as well as restaurant bills that typify most star hotels. In fact, the potential for serviced apartments in the city will increase manifold when improving economic dynamics will once again warrant longer periods of business travel," Aslam said.
Times of India
Hospitality sector poised for significant growth
V. Jayanth
— FILE PHOTO
UP AND COMING: A five-star hotel project of the Indroyal Group coming up at Chakkaraparambu in Kochi.
The Hindu
| High tariffs, good occupancy levels, but seasonal fall in traffic |
Development of serviced apartments gains ground
Global hotel
chains keen to
enter India
UP AND COMING: A five-star hotel project of the Indroyal Group coming up at Chakkaraparambu in Kochi.
CHENNAI: Following the boom in the real estate sector, the hotels and hospitality sector appears poised for a major push over the next two to three years. According to some estimates by the Union Tourism Ministry, there can be an up to 80 per cent rise in hotel rooms in the next two years.
At the beginning of 2007-08, it was estimated that there were about one lakh rooms available for occupation across the country. It was felt to be 1.5 lakh rooms short at that stage. Given the expansion plans of existing hotels, and the expression of interest by new hotel chains to enter the high-demand Indian market, the tourism authorities expected an addition of 80,000 rooms by 2009. That could still meet just over half the projected demand, leave alone the growth potential during this period.
Corporates and visiting businessmen from abroad have been complaining both about non-availability of rooms in some cities, and correspondingly the ever increasing hotel tariffs. “We have metros where room rates have hit the roof top at between $400 and $500 per night. It is not as though all rooms cost so much. But the tariff goes that high, and during the season, it is not even possible to get good rooms in the city centre. On an average, the rates are upwards of $200 (about Rs. 8,000) for quality rooms,” explains a Vice-President (Finance), who handles the business for visiting foreign clients.
Rooms are difficult to come by in New Delhi, Kolkota, Mumbai, Chennai, and Bangalore in particular. There are centres where not many quality or star hotels are available, but industrial and commercial development has already taken place. The hotel chains may be taking their time to develop facilities there.
Sensing the potential of the market, at least a dozen leading global hotel chains have shown considerable interest in India. Some of them, such as the Hilton group, have also identified partners to take up joint venture development here. Builders such as the DLF group are also getting into the hospitality sector to meet this demand. Hospitality industry sources say that Hyatt, Intercontinental, Marriott, and Starwood, are some of those who will be entering the Indian market in a big way in the next couple of years.
Another concept that has gained ground here seems to be the development of serviced apartments. Especially in centres with a ballooning IT and ITeS (IT-enabled Services) business, these apartments have become useful and provide attractive rates for those renting or leasing the accommodation for an extended period, say three months or even more. It comes in handy for couples who come together, or executives willing to share an apartment with common facilities. Industry sources say this segment of the hospitality sector may also be expanding significantly in the years to come. But both tourism authorities and the industry welcome the clear separation of the hospitality sector — five-star hotels, the three-star category, serviced apartments, business hotels, and budget hotels. But the key to success lies in good maintenance and excellent service. That means, aside from the development or building of hotels, the industry needs to recruit and train qualified service staff.
The Hindu
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The purpose built, spanking new and classical architecture of Manjunatha Residency serviced apartments reflects the old world charm of the city.The facade of this Bangalore located service apartments, will lift your spirits even as you enter the street after a day of work or play.
A fabolous alternative to the traditional hotels, the brand new,upscale and ultra modern interiors of Manjunatha Residency is designed with a contemporary look.A cut above the rest because of its lseek and stylish design, Manjunatha residency has been created to blend comfort and sophistication.
Everyday objects at Manjunatha Residency - the drapery,furnishings and quilts,the crystal and lighting fixtures have all been meticulously handpicked afrom around the world to pamper you.
The purpose built, spanking new and classical architecture of Manjunatha Residency serviced apartments reflects the old world charm of the city.The facade of this Bangalore located service apartments, will lift your spirits even as you enter the street after a day of work or play.
A fabolous alternative to the traditional hotels, the brand new,upscale and ultra modern interiors of Manjunatha Residency is designed with a contemporary look.A cut above the rest because of its lseek and stylish design, Manjunatha residency has been created to blend comfort and sophistication.
Everyday objects at Manjunatha Residency - the drapery,furnishings and quilts,the crystal and lighting fixtures have all been meticulously handpicked afrom around the world to pamper you.
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Indian hotels - iconoclasts or renegades?
India's hotel industry has attracted worldwide attention on account of the country's sizzling economy fueled by a high-octane diet that includes BPO (Business process outsourcing), exports, FDI (foreign direct investment) with most economic observers predicting that the country is merely in the nascent stage of a takeoff.
The country's hotel industry is the subject of conferences, articles and investment attention from virtually all the big players. At tourism fora such as ITB Berlin (where India was the main sponsor) and WTM London, the country has begun to play an increasingly prominent role with a variety of hospitality providers showcasing their wares including the MICE market where India barely figures.
The challenges for both providers and customers are far too many to enumerate but a representative sample surely will include infrastructure issues such as airports, roads and the paucity of hotels. The good news about hotels is that the sector is almost entirely out of the hands of governments (local and national) and, therefore, responsive to the tremendous opportunities that are there to be had for the less than faint-hearted willing to navigate the development process.
The bad news is that opacity and corruption (apart from "black" money demanded by sellers, officials at the state and central level are known to ask for "fees" to expedite processes) in the land acquisition process combined with stratospheric prices even by Western standards make it virtually impossible for outsiders to be principal developers. A fast diminishing supply of trained labor makes operations forbidding as well.
The situation at the retail level is unfortunately not much better and arguably worse. Groups arriving with guaranteed contracts for hotels in major metropolitan areas are being denied rooms and find themselves stranded. Hotels quoting rates in US$ are known to then change it on account of the dollar's drop subsequent to the booking!
That from cities that already rank in the top ten for average rates worldwide (the 2006 average room rate for Bangalore was a whopping $330). Corporate travelers are reacting by embracing service apartments and guest houses. For the near term though, visitors, both corporate and tourists, have to put up with the renegade behavior of some of the hotels and hope that the infusion of investment in the industry will ease the uncertainty as more inventory comes into the market.
But with some predicting GDP growth of nearly 10% per year, it is going to require a lot of inventory to reduce prices and minimize the extortionate practices of some of the rogue operators.
Vijay is Chief Operating Officer and part-founder of Apple Core Hotels- a chain of 5 midtown Manhattan hotels offering value and comfort in the heart of the city.Member of the board of Directors - Hotel Association of New York.
4hoteliers.com
The country's hotel industry is the subject of conferences, articles and investment attention from virtually all the big players. At tourism fora such as ITB Berlin (where India was the main sponsor) and WTM London, the country has begun to play an increasingly prominent role with a variety of hospitality providers showcasing their wares including the MICE market where India barely figures.
The challenges for both providers and customers are far too many to enumerate but a representative sample surely will include infrastructure issues such as airports, roads and the paucity of hotels. The good news about hotels is that the sector is almost entirely out of the hands of governments (local and national) and, therefore, responsive to the tremendous opportunities that are there to be had for the less than faint-hearted willing to navigate the development process.
The bad news is that opacity and corruption (apart from "black" money demanded by sellers, officials at the state and central level are known to ask for "fees" to expedite processes) in the land acquisition process combined with stratospheric prices even by Western standards make it virtually impossible for outsiders to be principal developers. A fast diminishing supply of trained labor makes operations forbidding as well.
The situation at the retail level is unfortunately not much better and arguably worse. Groups arriving with guaranteed contracts for hotels in major metropolitan areas are being denied rooms and find themselves stranded. Hotels quoting rates in US$ are known to then change it on account of the dollar's drop subsequent to the booking!
That from cities that already rank in the top ten for average rates worldwide (the 2006 average room rate for Bangalore was a whopping $330). Corporate travelers are reacting by embracing service apartments and guest houses. For the near term though, visitors, both corporate and tourists, have to put up with the renegade behavior of some of the hotels and hope that the infusion of investment in the industry will ease the uncertainty as more inventory comes into the market.
But with some predicting GDP growth of nearly 10% per year, it is going to require a lot of inventory to reduce prices and minimize the extortionate practices of some of the rogue operators.
Vijay is Chief Operating Officer and part-founder of Apple Core Hotels- a chain of 5 midtown Manhattan hotels offering value and comfort in the heart of the city.Member of the board of Directors - Hotel Association of New York.
4hoteliers.com
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