Hotel rates in metros drop 5-20 per cent in peak season

Many markets have seen new supply of hotel rooms, which is putting pressure on room rates

Travel News
Travel News

Hotels rates in top Indian cities have dropped compared to last year primarily due to fresh supply of hundreds of hotel rooms while there was no corresponding surge in demand. 

Room rates for hotels in Delhi, Mumbai, Bengaluru, Chennai and Hyderabad this winter season are 5-20% less than last year. 

"Many markets have seen new supply of hotel rooms, which is putting pressure on room rates," Vivek Nair, vice chairman and managing director at The Leela Group and president of the Federation of Hotel & Restaurant Associations of India, said. 

Room rates at luxury hotels in Chennai have dropped by 10-15% compared to last year because two large luxury hotels have come into the market. In Bengaluru, room rates have slipped by 5-10% while Hyderabad has performed the worst with a 20% drop in rates over last year. 
Close to 5,000 new rooms have been added in the three-to-five star and luxury categories in the five cities. About 1,200 rooms became operational in Delhi-NCR this year, 800 in Mumbai, 1,300 in Bengaluru, 800 in Chennai and 750 in Hyderabad. Winter months usually make for 60-65% of a hotels business in a year and October through March is the peak travel time to India both for corporates and leisure travellers. But clearly, this year demand for rooms has not kept pace with the growth in supply. 

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