Hotels jack rates up 20-40%

These are curious times for travellers. While air fares have been falling, the average room rates of five-star hotels across the country are now 20 to 40 per cent higher as compared with rates a year ago.

The rates have been riding on the back of robust demand "" fuelled by hectic corporate travel due to the booming economy in general and aviation, information technology and IT enabled services in particular.

Welcomgroup vice-president B Hariharan said the chain had increased its number of rooms by 3 per cent, in line with the rising demand.

Still, in the National Capital Region alone, estimates are that an annual demand of 8,000-9,000 rooms is not being met because of lack of rooms or rates being too high, according to Siddharth Thaker, associate director with HVS International, a hospitality consulting outfit.

Data for April show that ITC Welcomgroup has increased its rates by as much as 33 per cent in all the busy cities, such as Mumbai, Delhi, Kolkata and Bangalore.

In these cities, the rates now stand at Rs 6,500, Rs 8,000, Rs 4,400 and Rs 13,000, respectively, per night.

Oberoi's rates have increased by as much as 39.5 per cent in Kolkata (Rs 5,351), 29.78 per cent in Mumbai (Rs 10,972), 21.4 per cent in Delhi (Rs 9,990), and so on.

Leela has increased rates by 28.8 per cent in Bangalore to Rs 18,353, arguably the highest in the country, 38.6 per cent in Mumbai to Rs 7,806 and 13.4 per cent to Rs 6,799 in Goa.

The Taj group's figures could not be obtained officially. However, industry figures show a 33 per cent rise in rates of Taj Bengal, in Kolkata, 36.5 per cent of Taj Heritage in Mumbai, 30.9 per cent of Taj West End in Bangalore and 24.6 per cent in Taj Mahal, New Delhi.

The Park has raised its rates by 52.8 per cent in Delhi, 24.9 per cent in Kolkata, 40.86 per cent in Chennai and 58.38 per cent in Bangalore.

Hariharan pointed out that there had been a 50 per cent increase in the frequency of flights in the last 12 months alone.

Then, the old problem of seasonality -- which entailed long periods of low occupancy at the hotels -- seems to have resolved itself.

Instead, in the metros there is now a weekly swing -- high demand Monday to Thursday, a little lower on Fridays, and a sharp dip on the weekends. That again can be put down to the routine of corporates.

However, the weak weekend demand does not necessarily mean low rats. Instead, One can find hotels offering free lunch or free laundry on weekends.