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Domestic and international branded economy and budget hotels in Mumbai represent 5% of the total supply. Photo: Pradeep Gaur/Mint (Pradeep Gaur/Mint)
Domestic and international branded economy and budget hotels in Mumbai represent 5% of the total supply. Photo: Pradeep Gaur/Mint
(Pradeep Gaur/Mint)

Hotel occupancy, revenues remain flat in Mumbai

Revenue per available room dropped by 2% in FY13, as against an increase of 4% in the last three fiscal years, according to Jones Lang LaSalle

Mumbai: More hotel rooms in Mumbai were occupied in fiscal 2013 than in the year before but revenue per available room (RPAR), a key industry metric, fell because of increased competition, a new study shows.

RPAR for hotels in Mumbai dropped by 2% in the previous 11 months, as against an increase of 4% in the previous three fiscal years, property advisory Jones Lang LaSalle India said in a report released on Monday.

This was because average daily rates declined by 8% to 8,450 a room due to recent supply additions, though occupancy strengthened to 64% in 2012-13 from 60% in the previous year, it said.

Hotels in south Mumbai are the worst affected, both because of terror attacks in the area in previous years and as more companies move their offices from the traditional central business district to central and north Mumbai due to cheaper rents, the report said.

Mumbai has 45 hotels with a total 10,537 rooms across categories. Luxury and upper upscale hotels dominate with a 69% contribution to the overall inventory of rooms in the city, the consultancy said in its report.

Among the prominent hotel operators in Mumbai are the Hyatt, Marriott, Four Seasons, East India Hotels Ltd that operates the Oberoi and Trident hotels and Indian Hotels Co. Ltd that runs Taj Group of Hotels and Resorts.

Upscale hotels contribute 14% of the total inventory followed by the mid-scale segment that claims an 8% share. Domestic and international branded economy and budget hotels in Mumbai represent 5% of the total supply.

Serviced apartments in Mumbai, offered by Marriott, Oakwood, Grand Hyatt and Taj in the branded segment, collectively contribute the balance 4% of the total inventory.

According to the report, 13 hotels with a total 3,394 rooms are being constructed in Mumbai across categories, which when operational will increase the city’s total hotel rooms by 32%.

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