Appu Hotels set to expand in south

Appu Hotels, which owns Le Royal Meridien (part of the US-based Starwood Hotels and Resorts Worldwide), Chennai, is all set to spread its wings down south and is in the process of setting up hotels one each in Coimbatore, Puducherry and Tuticorin.

The company is setting up a Rs 250 crore five-star hotel in Coimbatore and Rs 100 crore apartment hotel in Puducherry. However, it is still scouting for land in Tuticorin for its third hotel, for which investment figures have not yet been finalised.

"The Coimbatore hotel will have around 250 rooms, while the Puducherry apartment hotel and the Tuticorin hotel will have 150 rooms each. We are also planning to increase the total number of rooms by 450 in the three hotels by the end of 2009, with an investment of Rs 350 crore," said Nalina Saravanan, director- operations, Le Royal Meridien, Chennai.

The Coimbatore and Puducherry properties are expected to be operational by mid-2009. The company is planning to employ about 500 people in Coimbatore, 250-300 in Puducherry and 200 people in Tuticorin.

"We chose Coimbatore as one of the locations for our new hotel because of the emerging IT companies there. As far as Tuticorin is concerned, we believe that the new port that has come up is enough reason for us to set up our hotel there," she said.

"Though it is too early to comment on revenue expectations from our new ventures, I would say that our revenues might go up by around 20 per cent once the new hotels become operational. It would be premature to comment on expected occupancy rates in the new hotels," Nalina added.

The occupancy rate of Le Royal Meridien hotel at Chennai was around 38-40 per cent six years ago at the time of its commencing operations, and has jumped to around 94-96 per cent in February, triggering a demand for expansion.

"To meet the growing demand, we are planning to set up a beach resort by 2010 on Chennai's East Coast Road (ECR), where we own 10-acre property," she said.