)
As against mere 500 rooms being added last year, the Ahmedabad hospitality industry is set to witness a boom with almost 100 per cent growth in supply in the year 2014. The city may see anywhere between 700 and 1000 rooms being added by the end of the year.
According to industry sources, with a strong pipeline of brands like Ascott's Citadines Apart' hotel, Hyatt Regency, Ibis, ITC hotel, The Lalit, The Lalit Traveller and a brand of Hilton Worldwide among few others, the city will see in all over 2,000 rooms to be added by 2018. Moreover, much of the supply is being anticipated in the upscale and premium segments.
Growth in the hospitality industry in terms of room additions is being attributed to several factors such as growing presence of manufacturing and services sectors in regions like Sanand and GIFT City, along with convention centres like Mahatma Mandir attracting increasing number of business events.
"The city has reasonable demand drivers in the form of new investments in industry, infrastructure and convention facilities to absorb the supply over the next 2-3 years," said Mandeep Lamba, Managing Director India, (Hotels & Hospitality Group), Jones Lang LaSalle Property Consultants Pvt Ltd.
Add to that, growth of manufacturing and service sector in and around Ahmedabad, especially with much manpower movements in the BFSI and IT sectors in recent times.
"There have been good positive movements in Ahmedabad, right from the announcement of DMIC passing through it, the auto industry with brands like Ford and Honda coming up in Sanand and other areas, as well as the services sector set to grow in and around GIFT City. Several multiple factors can be attributed to the growth in the hospitality industry," said Girish Ganeshan, general manager of Hyatt Ahmedabad.
For instance, joining the bandwagon of brands like Hyatt, Courtyard Marriott, Novotel and Radisson Blu, a five star hotel by Hilton Group may soon come up in Ahmedabad. city-based Hirise Hospitality Pvt. Ltd. refused to divulge details of the brand that will manage the property, according to market sources, it could be a Hilton brand.
"There are a total of 185 keys in the property along with two restaurants, 1 floor as spa and gym and roof top pool and sky lounge. The second last floor has a business centre. The project is being designed by Studio Symbiosis and will be operational by June 2015," said a director at Hirise Hospitality, refusing to divulge project cost details.
However, the project cost is likely to be over Rs 120 crore, according to sources. However, there are doubts over how the increased supply will impact occupancy rates as well as average room rates (ARRs).
According to Ganeshan, it is a consistent buoyancy in market maintained by the private sector that will help the industry make the most of the additional supply. Meanwhile, Lamba opined that there will be some impact in the short term.
"We feel that on account of all the that new supply of branded rooms coming into Ahmedabad, there will be a demand supply mismatch in the short term causing stress on occupancies and ARR's over the next year or two," Lamba added.
