12% Decline in Hotel Tariffs

March 30, 2009	(Be the first to rate this story!)  Loading ...
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Staying in hotels has become a tad cheaper. Room rates or tariffs have fallen by 12% globally in the fourth quarter in 2008 compared with the same period last year, according to a report. The Mumbai terror attacks weighed heavily on hotels apart from the global recession. But it is not all gloomy because it would seem to be the best time for the traveller. “There are many bargains to be had for travellers. This year really will be the ‘year of the deal’,” David Roche, president, Hotels.com Worldwide said. “The Asia-Pacific region recorded its first year-on-year drop in hotel room prices since 2004. This drop in prices was small, falling by 2%, however, there were substantial drops in large Asian cities including Hong Kong, Singapore, Beijing and Mumbai,” according to the latest Hotel Price Index (HPI) from Hotels.com.

Most hotels in Chennai have reduced room tariffs. “We have has seen a 10% fall in average room rates due to the slowdown and there has been a drop in international travel, but the domestic market remains strong,” said V V Giri, general manager, The Park Chennai. Sources in the Sheraton Park also said that room rates have fallen close to 25% in Q4 2008 compared with the same period last year. “With occupancy down, hotels want to fill rooms. So, offering the best possible rates is the only option,” said R Srinivasan, CEO of Radha Regent, a budget hotel in the city. Radha Regent recently opened a hotel in Bangalore.

But not all hotels are part of this trend. Courtyard Marriott is one which has maintained its tariff. “As a general phenomenon, the tourism industry has seen a decrease and we have also felt the effects. However, since the hotel is celebrating its 10th anniversary in India, we have our ‘10 Reasons to stay with Marriott’ campaign that will help us maintain our competitive edge along with occupancy,” said Karan Berry, general manager of Courtyard Marriott. The business hotel has seen an upward growth in occupancy, Berry said. The chain has 25 properties in the pipeline (six in India alone).

Prices in Chennai have dipped less compared with cities like Mumbai and Delhi that have seen a 41% and 4% drop in room prices. In Mumbai the prices fell to Rs 9,300 ($186) from Rs 15,900 ($318) and in Delhi prices fell by Rs 350 per room per night. With the slowdown, hotels have shifted their focus from occupancies to the food and beverage segment. The Courtyard Marriott has started several new plans. The Sheraton Park has introduced a new ‘locavore’ menu (sourcing ingredients from local markets). Now destinations that were considered too expensive for budget-conscious travellers are now offering considerable savings. For example, hotel prices are down in many popular cities such as London, down by 24%, New York 22% and Barcelona (21%), making it an ideal time to visit these destinations, said Roche of Hotels.com.

News Published Under:   Hotel Industry in India |

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