The hospitality sector in the rapidly growing metropolis of Hyderabad is banking on buoyancy in business to boost occupancy levels.
If 2012 was a year of consolidation and launch of over half a dozen marquee brands such as Radission Blu, Part Hyatt, it will be the turn of The Oberoi, Trident, Hyatt, Minerva group among others to step up presence in Hyderabad.
The year gone by saw the mega Conference of Parties being held at Hyderabad International Convention Centre, billed as one of the biggest conventions to be held in the country. However, the occupancy levels were described as average to good by the sector players, depending upon the location in the city. They felt that it could have been better provided the business environment was buoyant.
In fact, the issue of Telangana statehood and the debate around it without any definitive moves has been and continues to loom large. A decision taken to create a separate State or otherwise, would help clear the air of uncertainty, according to P.K. Dutt, General Secretary, Hotels and Restaurant Association of Andhra Pradesh.
He described 2012 as a mixed experience. The hype around the COP event was good in some properties and reasonable for others. The uncertainty around the separate Statehood has resulted in some of the businesses postponing their expansion moves and others considering cities such as Pune, Nagpur and Bhopal.
The hospitality business, like the growth of the city, is gradually getting polarised depending upon the location. Most of the new projects are now being developed along the IT hub of Hitec City and Gachibowli and in the areas closer to the new international airport.
However, a representative of the sector felt that like NCR region and Bangalore, where a number of hospitality projects were developed, Hyderabad may also pass through a phase where there could be temporary oversupply. But this evens out in the long run, he explained.
Launch of at least three other projects is likely to spill over to 2013, which could include a Ginger project. Akesh Bhatnagar, General Manager, Golkonda Hotel, said the costs have gone up for managing hospitality infrastructure, including running hotels on DG sets due to power cuts and employee wages, but visitors are demanding lower tariffs. This is resulting in margin squeeze.
The Government needs to play a pro-active role in boosting the business sentiment. That is when the visitor/tourist and business flow goes up, he said. If the last year saw the launch of Vivanta by Taj, Park Hyatt, Radisson Blu, Avasa, Marigold by Greenpark, Royal Orchid’s Re:Gen:Ta One among others, this year will have the opening up of the Oberoi, Trident in the IT hub, Minerva and Swagat.
Dutt felt that the occupancy levels and returns could get better provided the business environment improves.