Leela Hotels in Jaipur & Agra
Rajiv Kaul, President, The Leela Palaces, Hotels and Resorts, tells about the hotel’s growth in 2015, its plans and expectations from 2016.
The Leela Palaces, Hotels and Resorts witnessed a modest growth in room rate of about of 5 to 8 per cent in 2015 over 2014. Occupancies have also grown by about 2 to 5 per cent.
“Overall there is a top line growth of 7 to 8 per cent; it’s a single digit growth. We all were hoping it will be 15 per cent growth, but that is not the case. We expect the fourth quarter to be three strong months, but what we are getting is three strong weeks. Certain weeks can be engines of growth, but by and large it is flat. Oversupply has neutralised. Rates today are less than what they were eight years ago in rupees and in dollars it would be even worse,” Kaul says.
The three properties in the Delhi-NCR, operated by the Leela Group, are very different from one another as they cater to three different market segments and price points. Kaul mentions, “The Leela Palace, New Delhi, Chanakyapuri, does not have negotiated rates (90 per cent of the business is on nonnegotiated rates). The Leela Ambience Gurgaon Hotel & Residences has only 15 per cent of its business as MICE, while the Leela Ambience Convention Hotel, Delhi, will have 60 per cent of the business as MICE.”
Talking about their prospective joint venture partnership, where The Leela Group will be the managers in line with their asset light growth strategy, Kaul comments, “We are going to start work in Jaipur by February. We hope to have that ready in a year’s time. It will be a 56-room Leela Palace Hotel. We hope to break ground in April or May in Agra, which will also be a luxury hotel. Agra will take close to three years, and will be a 90-room luxury property, with all rooms overlooking the Taj Mahal.”
On the inbound market, he adds, “Inbound has gone down; however I am still optimistic. The US market is showing growth, and it will continue to do well particularly because their dollar is strong. We have to be selective in Europe because there are certain countries that will do well and others will not. The Russian market is down in a big way. That is definitely a deficit that we have to overcome particularly for Goa and other leisure destinations.”
President The Leela Palaces, Hotels and Resorts