Having registered growth in average rates and occupancy numbers, after several years of sluggish performance, Delhi hospitality industry has reasons to be upbeat. With an eye on better understanding ongoing churnings in the market, we spoke to Rohit Arora, Area General Manager, The Park. In a free-wheeling interview, he gave his insight on trends in business and footfalls in the Delhi market.
There is no denying the fact that Delhi and, especially the micro-market of Central Delhi, is a competitive space with abundant inventory on offer for consumers. Adding to woes for hoteliers, the cyclical nature of industry and a sluggish market post 2008 had made operations and generating revenue an all the more daunting task. 2016, however, has come as sweet music for industry stakeholders as solid occupancy numbers and rise in average rates have bucked the trend of an eight years old downward spiral. Delhi registered 1.9% increase in average rates. The growth may be modest but the upward tick is likely to continue and gain momentum in the coming months, suggested Rohit Arora.
“Connaught Place has bounced back as a hub,” he said, analysing the micro-market of Central Delhi. “The night life is vibrant and our club, Agni is doing really well. Also, the summer season saw good numbers and a healthy mix of travellers. Summer has turned into a good business season and we are hopeful that winter season will be robust, too,” added the General Manager. His assertion is backed by the fact that Central Delhi witnessed the highest rise in occupancy numbers in 2016, clocking a healthy 7.2%.
Giving a detailed insight into the market post GST, Rohit Arora said that while room occupancies had remained unaffected, F&B segment had taken a temporary hit “owing to all the confusion surrounding tax rates”.
Looking ahead, with over 1700 new rooms expected to be added to Delhi’s inventory in the coming year, the supply side remains fairly robust. Rohit Arora, however, argued otherwise, noting, “I doubt that all these 1700 odd rooms will be added in the next year. Some projects will get deferred.” He also reasoned that despite the ongoing addition of inventory and competition, “there was enough space for all players to grow.” “Delhi market is consuming the supply. There is a healthy competition which is good for the industry and consumers,” he added.
Sharing key trends in footfalls in his hotel, he informed that much of the hotel’s business was being driven a mix of leisure footfalls and small-sized MICE groups comprising of 30-40 people. “Both these elements are giving us good business,” Rohit Arora said. He detailed that The Park New Delhi had altered their outreach strategy with pronounced focus on online business avenues. “There has been a shift in strategy in the past couple of years. It has been on both fronts – for rooms as well as for F&B segment. We have concentrated on a mix of online avenues, including online aggregators and our own website. We have trained our focus on getting corporate business through GDS platforms. All of these measures have served us well and hopefully continues to do so,” he said.
