Vijayawada star hotels see 20% rise in occupancy

Star hotels in Vijayawada are on a roll as the occupancy rate in 2003-04 has gone up by around 20 per cent.

After a dismal fiscal 2003, during which business nosedived by 10 per cent, the hotels are upbeat about the current fiscal due to a score of congenial factors like increasing foreign tourists, booming business, better infrastructure facilities and other development projects which are attracting a large number of visitors to the city. At present, the average occupancy rate in the star hotels here is around 50-60 per cent.

Also, the ensuing religious celebration of 'Pushkaram' is expected to push the occupancy rates to an all-time high. Vijayawada has only one four-star hotel and 10 three-star hotels. The four-star hotel, Quality Inn DV Manor, has a tie-up with an American hospitality group Choice Hotels International.

The number of tourists, particularly foreigners, who visit the city has been growing by leaps and bounds, thanks to the efforts of the state tourism department.

The city is also developing fast into a choice venue for state and national level conferences of corporations and professionals, sports meets and social and cultural events. Star hotels and their hospitality have become a part of them.

Tourists from Southeast Asia visit the city for its world famous historic Buddhist sites such as Undavalli Caves and Amaravathi. The other spots of interest include Victoria Museum, Bhavani Island, Mangalagiri, Kondapalli, Manginapudi beach, Kuchipudi, Kolleru and Kanakadurga temple.

Lakhs of tourists, especially from abroad, are expected to flood the city for a dip in the Krishna river during the ensuing 'Pushkaram'. The once-in-12-years 12-day event is certain to boost hotel business to a great extent.

The next phase of expansion of the Vijayawada Thermal Power Station will begin in September this year. The massive construction work is expected to bring a number of experts and executives of the foreign companies to the city.

The strategic location of the city has also been attracting many corporates and multinational corporations who are either starting new offices and showrooms in the city or shifting branches from Visakhapatnam to the city. New showrooms and corporate offices are being opened almost every day.

The city hotels have geared up for all these developments. Also, the state government's ambitious infrastructure programme of providing good and wide roads to and fro Vijayawada, drinking water facilities, and power supply has made the city first among equals and a destiny for businessmen and industrialists of all sectors.

Rajesh Berry, general manager of Quality Inn DV Manor, said that 2004-05 would be a great year for hotel business in the city. "The luxury tax levied on the hotel industry in the state is the lowest when compared with 12.5 per cent in Chennai and 10 per cent in Karnataka. There has been political stability in the state, which is very important for the growth of hotel business. The government has a positive mindset on providing good infrastructure facilities," he added.

Berry said that the hotel had witnessed a 5-6 per cent drop in the occupancy rate in 2002-03.

"The hotel charges maximum tariffs in city "" Rs 1,450 for a single room and Rs 1,750 for a double in the executive section; Rs 1,790 for a single room and Rs 1,990 for a double in the deluxe section; Rs 2,290 for a junior suite and Rs 2,590 for a luxury suite. All the sections in the hotel are buzzing with customers," he said.

Hotel Ilapuram, which charges the next highest tariff, is an exception to the general trend of slump in the occupancy rate in 2002-03.

I Raja, managing director of Hotel Ilapuram, said: "During all the three years (2001-02, 2002-03 and 2003-04), business has been good for me. A number of new and foreign customers, along with regulars like businessmen, industrialists and corporate executives enjoyed the hotel's hospitality. The occupancy rate on an average stood at 70 per cent. We expect an increase in business this year." He said his hotel could not go for a four-star status due to space constraint.

The managing director of Raj Towers, V Nagamalleswara Rao, said that power charges had escalated by 20 per cent over the past three years, adding that power rates and power supply have become big problems for hotels.

Malleswara Rao, who is also the president of Vijayawada Hotel Association, regretted that the government had not so far given industry status for hotels. They should be given industry status and electricity supplied and other sops given to them accordingly.

K Bindu Madhava Rao, managing director of Krishna Residency, said that their business increased by 20 per cent in 2003-04. As a result of uniform tax policy, the tax on food and beverages had gone up from 5 per cent to 8 per cent.

But the government helped them by reducing the luxury tax from 10 per cent to 5 per cent three years ago. He said there had been a dearth of skilled hotel management staff in the city. The need of the hour was to start training institutions in catering and hotel management.

Striking a contrasting note, Swarna Palace hotel sources said that 2003-04 was a disastrous year for the hotel. The government's road-widening programme spoiled the business totally. The hotel compound wall was demolished and the car""parking space taken away. The occupancy rate crashed by 75 per cent.