Five-star halts

HOSPITALITY: Big ticket projects are planned for Kolkata, but none fall in budget category.

The hotel industry in Kolkata is in the midst of a boom. Nothing surprising considering the state's economy is looking up.

A slew of hotels will add 1,000 rooms to the existing numbers in the next two years "" an InterContinental in Rajarhat plus a Marriot in the vicinity, with a Hilton and another luxury development by Emaar-MGF coming up on the Eastern Metropolitan Bypass, not to speak of the 224 rooms at the renovated Great Eastern Hotel.

If none of these big-ticket projects fall in the budget category, it's because all hoteliers have a single point grouse "" high real-estate prices. Prabhat Pani, chief executive officer, Roots Corporation, which is rolling out Taj's Ginger hotels across the country, says he's on the lookout for land, but given the prices government-auctioned plots have been fetching, he's "not very hopeful" of finding one in Kolkata or its vicinity.

Realtors, however, do not agree that the price of land is high in Kolkata. "It's the same in all other metros. It's just that when it comes to investing in this city, companies look at prices in keeping with tier-II cities," says Jeetendra Khaitan, chief executive office, Pioneer Property Management Limited.

The only brand of new-generation budget hotels to begin operation in Kolkata soon is the 100-room Fortune Kolkata. Fortune Park Hotels is also said to be in negotiations for managing The Loudon (formerly Hotel Rutt Deen).

The other top-drawer project is the 150-room three or four-star facility coming up over the City Centre II mall in Rajarhat. Also in the pipeline: a 64-room four-star development on AJC Bose Road slated to open in October 2007, another heritage hotel on Camac Street, and a 100-room budget hotel from the Peerless group in Rajarhat.

At the 105-room four-star hotel, The Kenilworth, occupancy ranges between 80-100 per cent, while ARRs have gone up 40-45 per cent to touch Rs 5,000, says R S Singh, vice-president. At The Peerless Inn, resident manager Tarun Maity, reports an increase in ARRs by 10-25 per cent.

At The Kenilworth construction is about to begin at the old wing where another 45 rooms will be added. At Peerless, a new 60-room tower is to come up by the end of next year.

Clearly these won't be enough as the Kolkata market looks set to sustain a wider range of hotels, spanning a spectrum of service and price points. Little choice there though.