Post-pandemic business models and trends lean towards leisure hotels, immersive experiences

To throw light on how the domestic market lent a strong support for the Indian hospitality industry during the challenging period of the pandemic, Nitin Kapur, Managing Director, Radisson Blu Plaza Delhi Airport; Ranjit Batra, President – Hospitality, Panchshil Realty; Vibhas Prasad, Director, Leisure Hotels Group and Vineet Verma, Director, Brigade Hospitality expressed their respective opinions during the Owner’s Session on Hotel Ownership – Rapid Evolution of Expectations and Opportunities at the BW HOTELIER Indian Hospitality Summit and Awards 2022. 

During the session, Nitin Kapur pointed out that there has been an increase in the number of middle-class families travelling and choosing a hotel brand for leisure experience. “We are witnessing higher double occupancy percentage in rooms with people choosing to spend more time in a hotel. This is great as they use more ancillary services that add up to the RGI (Revenue Generating Index),” he shared. Kapur added that he expected this trend to continue and talked about the plans of building on the F&B experience and expanding to leisure destinations in India including Tier III and IV cities at the mid- and upper-mid segment. 

Talking about how business hotels faced massive challenge with quarantine and travel restrictions in place, Vineet Verma lamented that the “pandemic has been most hostile to the most hospitable sector” in light of hotels being temporarily shut down. While comparing monthly performance numbers to pre-pandemic figures, Verma shared on witnessing a significant increase lately, adding the biggest lesson was of “learning to do more with less”. While earlier the hotel’s focus had been split to 60 per cent on the top line and 40 per cent on the bottom line, the situation is just the opposite now. “We have to be mindful of the costs and optimising expenses, especially now with fewer people opting for a career in the hospitality industry. Moving forward, we, at Brigade Hospitality, are focussing on recovering debt while also looking at mixed used development (such as a hotel on top of a mall or a lifestyle conclave with a hotel) and while they may acquire hotels, they will be mostly business-class, four to five-star hotels as opposed to luxury properties,” he added.

Echoing Verma’s sentiment was Ranjit Batra. “How I wish we were in leisure marketing,” he opined, adding that this has been a great learning opportunity for most in the industry, especially ones looking to expand their businesses. Among the learnings, Batra said, “We have become more responsible and super-efficient as owners and operators. This was required in the hotel industry.” He felt one of the best things to come out of the past two years has been the emergence of creativity and innovation in the F&B space. Restaurants, catering and cloud kitchens have served as inspiration for the hoteliers and are spaces where a lot of potential and opportunity remains unexplored. “Panchshil Realty is currently focussing on mixed-use hotels, fractional ownership and residential hotel combinations with special attention on the leisure segment,” Batra said. 

Leisure travel and immersive experiences along with workstations have become popular with the pandemic. Leisure Hotels Group, a business built on domestic leisure travel, in Vibhas Prasad’s words witnessed, “historic highs in business” during the pandemic. After an initial drop in the first three months, business picked up rapidly for the Group. Despite this, Prasad is cautious about the rends they have witnessed, stating he believes they have reached an inflexion point. “This new normal is not here to stay so we have to be ready. It’s time to buckle up and prepare for the next phase in the hotel experience,” said Prasad. Additionally, the Group plans to build on the immersive aspect of the hotel and expanding its ancillary services like craft spirit business. 

Moderating the session, Sanjay Sethi, CEO & Managing Director, Chalet Hotels, pointed out that while the domestic market seemed to be thriving, foreign travel was expected to pick up soon. Sethi cited that September 2022 had already crossed the pre-pandemic numbers. Furthermore, the announcement of direct flights between Indian metros and the USA is a move in the right direction. “The hospitality sector is growing steadily. With the expansion of a new customer base and the industry responding to their needs while simultaneously investing in new experiences and services, it is an exciting time for the industry. Still, challenges regarding human resources and talent remain,” he said.