Bangalore opens up to new luxury hotels

The hospitality sector has discovered the hospitality of Bangalore!  From a city with a booming IT (information technology) industry, Bangalore is fast emerging as a centre for hospitality, with as many as seven luxury upscale hotels having come up in the last few months and many more on the anvil.

These new hotels will vie for customers with the existing names like The Taj, The Oberoi, The Leela, ITC Windsor Manor, ITC Gardenia and Lalit Ashok.

The Bangalore hospitality market seems to have suddenly exploded with many new entrants entering across all brands and segments, with many international brands appearing in India for the first time. Joining the home-grown players are a host of foreign chains, who view Bangalore as a great opportunity, thanks to its ‘IT hub’ status.

Sheraton, Alila, Best Western, Park Plaza, Movenpick and so on, are some of the new international properties all promising unmatched service and hospitality, while a few Indian chains are also extending their footprint in the City. Taj Hotels & Resorts set up its third Vivanta at Yeshwantpur last month, which is positioned as a new-age urban oasis eyeing corporate travellers. The seven promoters together are setting up nine hotels with around 2,154 rooms at a total investment of around Rs 1,500 crore.

Realty major Prestige Group has also marked its footprint on the City’s hotel scene by unveiling the 24 Tech Hotel within the Prestige Tech Park on the Sarjapur - Marathahalli Outer Ring Road. Meanwhile, several other foreign chains have shown interest in the City, such as Ritz-Carlton and JW Marriot which are scheduled to open in 2012.

Meanwhile, French hotel major Accor which opened its Grand Mercure in Koramangala back in 2008, will be opening three more hotels (two ibis, one Novotel) before the year-end, taking its City inventory to more than 850 rooms.

According to Accor India (Bangalore Hotels) General Manager Delegate Philip Logan, “There is no doubt that the emergence of Bangalore as an IT/ITeS hub in India has been instrumental in driving commercial office space in this City. There is a direct correlation in the upsurge of hotel demand associated with the emergence of this City.”

Accor, in a novel initiative, for the first time in the City will be setting up a ‘combo hotel’ with two properties in the same complex. It has set up a complete business hotel (ibis Bengaluru Techpark) in the mid-scale hotel space and an upmarket (deluxe) business hotel (Novotel Bengaluru Techpark) designed for the discerning business traveller, at a common property on Sarjapur Outer Ring Road, opposite the Intel campus. The chain’s third property ibis Bengaluru is coming up on Hosur Road in late 2011, featuring 185 guest rooms.

Moving nearer to business

One interesting new trend is that unlike in the past, when hotels were at the City centre, a large number of new hotels are coming up where their clients are based. Sarjapur Outer Ring Road, Marathalli, Whitefield, Hosur Road, Electronic City and Peenya are the new destinations for these hotels (See table). There are three main reasons behind this: Availability of land, lower land price outside the central business district (CBD) and huge catchment areas for customers, thanks to IT parks scattered outside the CBD.

As Logan of Accor group says, “Our location in real estate terms is exceptional, giving the best proximity to a large number of global Technology parks, all less than 1 km from our property. They can work longer at office or rest longer in their rooms rather than enduring long drives to work.”

Given the enormous development of office spaces on the periphery of Bangalore, this trend of going-nearer-to-customers will further escalate. Global hospitality services provider HVS reports that by 2016, Bangalore will have 8,500 additional hotel rooms to add to 7,300 existing room supply.

Says Sheraton Bangalore at Brigade Gateway General Manager Martin Wuethrich:

“Bangalore has grown tremendously since the boom of the IT sector. Every pocket of the City has seen growth. Now, the North-West part is becoming the highlight and will see a lot of growth over the next three years with the development of the metro.” Adds Park Plaza Bangalore General Manager Alexander Schneider, “Business travellers and hotel companies alike try to limit commuting distances as much as they can in order to prevent loss of time in traffic. That is the reason why we have chosen the Outer Ring Road for our hotel.”

At the same time, with many prestigious institutions as well as an Indian base of operations for many multi-national companies, Bangalore is also host to a series of conferences, seminars and symposia, attracting visitors from around the world. The City is also a starting point for excursions to many places of interest in the South, hence, bringing in tourists.

Growth opportunity

Logan opines that Bangalore has enormous growth potential with its wonderful climate all year round, closer proximity to tourist sites like Mysore, Coorg or Ooty and an intelligent educated young workforce. With the City hosting many business conferences, the need for adequate space with good facilities has increased. The Vivanta by Taj Yeshwanthpur has dedicated around 18,000 sq ft of its space to banqueting and conferencing, along with an independent convention centre and parking for 400 cars.

Though Bangalore has got a new airport and recently, inaugurated the rapid transit system of metro rail, a lot of infrastructural hurdles remain. The pitiable condition of the roads and the constant flow of migrant workers have caused concern to develop the infrastructure accordingly to tackle these needs. According to Vestian Chief Executive Officer (Asia-Pacific) Shrinivas Rao, “In the long run, if the infrastructural issues are addressed, Bangalore has huge potential for development. In the next five years alone, 28 million sq ft of commercial space will come up on the Outer Ring Road between Sarjapur Road and Manyata Tech Park, where seven to eight lakh people will be working.”

Meanwhile, the home-grown players have already shaped the City’s hotel scene way before the advent of the foreign chains, successfully setting benchmarks for Indian hospitality. But is the market big enough to sustain a boom in room availability?

Viewing this trend as a healthy one, The Oberoi Bangalore Director (Sales) Jaspreet Singh says, “Competition is healthy and important for growth. The foreign players’ entry into the (hotel) market shall give us both an opportunity to learn from their best practices and at the same time, sharpen our core strength of highly personalised services.”

Sheraton’s Wuethrich also feels that the competition will benefit the business and leisure travellers with improved service and facility options. Addition of new hotels also means many more direct and indirect job opportunities in the sector for the City. “In the hospitality industry, in terms of employment generation, there is immense learning, shaping one as a complete management professional,” Wuethrich adds.