Occupancy levels for hotels in Mumbai have either remained flat or witnessed only a marginal increase in its levels.

Sudeep Jain, Executive vice president – Jones Lang LaSalle Hotels (India) says, “Occupancy level reached 64% in 2012-13 from 60% in the previous year.” Since occupancy levels in 2010-11 averaged at 63%, the current level of occupancy is nearly flat.

According to JLL's research report on Lodging Market, Mumbai witnessed only a 4% increase in 'Revenue per Available Room'. in 2011-12 compared to 2009-10 period. This came on the back of one% increase in occupancy levels accompanied by a 2% growth in the average rates.

The revenues on available rooms has also dropped by 2% in the last 11 months. The average rate of hotel rooms in Mumbai is Rs. 8,450 compared to Rs. 9,500 last year.

Currently, Mumbai has 45 operational hotels, with an inventory of 10,537 rooms spread across six categories. As per JLL's research, there are 13 hotels currently under construction in Mumbai across different categories with a total inventory of 3,394 rooms. Once operational, the total room inventory of Mumbai will go up by almost 32% from the existing supply.

The inventory is expected to shoot up in the coming 5 to 7 years. This will happen on the back of upcoming office stock, as well as hotel supply entering the market, due to which demand levels are expected to remain stable.

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