Biz Boom Hikes Cost Of Rooms In Bombay, New Delhi.
August 05, 1996 - 12:00 AM ET
By FRED GEBHART
Biz Boom Hikes Cost Of Rooms In Bombay, New Delhi
By Fred Gebhart
New Delhi - Although most barriers to international business in India have been lifted in the past few years, foreign companies find themselves running into a new wall: finding a place to sleep for their employees and executives.
A 1993 decision to open India's economy to international participation has turned Bombay and New Delhi into two of the hottest destinations on the international business circuit. Occupancy rates have skyrocketed from the 60s to the high 90s. Room rates have rocketed toward $400 a night in Bombay and $350 in New Delhi.
"You simply cannot get a hotel room" in India's two gateway cities during the high season, warned Steve Kleinschmidt, managing director of PKF Consulting Ltd. Asia-Pacific in Hong Kong.
The toughest periods are September through October and April through May-traditional meeting and conference months for Indian government and business. Occupancy eases during the summer monsoon months, he added, but low season in Bombay and New Delhi now means something on the order of 90 percent occupancy rather than 98 percent.
Industry watchers in the region agree. "At any given time, demand outstrips supply in Bombay alone by 1,000 rooms," said Arup Sen, director of operations for Cox & Kings, India's largest business travel and destination management company and a local affiliate of BTI Americas. "You can get a junior suite at the Waldorf for the price of an ordinary room in India today."
Travelers to Bombay can expect to pay $375 a night "even with good connections," warned Jim Olson, senior vice president of development for Radisson.
In New Delhi, Hyatt Regency manager David Wilson reported a 40 percent increase in occupancy over 1993-94 for the 525-room property, one of the largest hotels in the country. Average room rates jumped 28 percent in 1994, 32 percent in 1995 and 26 percent for the first half of 1996.
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