Star hotels in the city are on a roll now. The growth in business and industries in the port city, apart from a rise in domestic tourism especially from West Bengal in the last eight months, have helped the star hotels reverse a three-year lean spell and boost the room occupancy rates between 10 and 20 per cent.
In fact, the hotels which were rolling out discounts on room tariff and food to woo customers, are now planning to hike room tariffs by around Rs 150-200 per room per day.
"In the last three years, the local star hotels saw occupancy rates plunge . But this year, occupancies in city-based star hotels have witnessed a spurt of 10 to 20 per cent, thanks to Bengal tourists and the industrial growth," S Prasant, vice-president of Hotels Restaurants Association of Andhra Pradesh and general manager of Daspalla Hotel, told Business Standard.
The city has 10 star hotels -- two five-star hotels, one four-star hotel and seven three-star hotels -- having a total of about 830 rooms with the tariffs ranging between Rs 700 and Rs 4,000 per room a day.
Till the last fiscal, a low average occupancy rate of 50-60 made several star hotels offer heavy discounts ranging from 10 to 40 per cent on room tariff and 10 to 20 per cent on food to attract customers, depending on the season.
"Now the situation has changed for the better and in the last eight months no hotel has been offering huge discounts on room tariff. Now, some star hotels are planning to increase the room tariff from 1 April," Prasant said, adding that the domestic tourist arrivals into the city this year has grown to three lakh from around one lakh, two years back. Also, Puri in Orissa used to be the main tourist destination for the Bengal tourists, but now there are coming in large numbers to Vizag, he said.
"In 2002-03, our occupancy rate was 55 per cent. This year it has gone up to 79 per cent. In addition, our revenue has increased by 38 per cent this year when compared to last fiscal," Mazumdar, general manager of The Park, the first five-star hotel in the state, told Business Standard.
"The HSBC call centre, the Apparel Park, the turnaround at the Vizag Steel Plant, the South Asia LPG Project are some of the factors that have boosted the occupancy rate in hotels. But one of the most important factors has been the flooding of Bengal tourists into the city during the festival seasons," he said.
Green Park Hotel registered a marginal growth of two to three per cent in occupancy. "We touched an occupancy rate of 81 per cent during the last fiscal. This year our occupancy rate has increased by another two to three per cent, but our revenue growth has been around six per cent," Madhu Nair, general manager of Green Park Hotels, said.
"The state government and the tourism department have created a lot of hype about Vizag. At present, the hype is paying off for the city hotels," he said. Despite the increase in occupancy rates, around 150-200 rooms are still vacant every day as the demand is still less than the rooms availability, he observed.
Dolphin Hotels, which has the highest number of rooms in the city, has seen a 20 per cent growth in occupancy rate this year when compared to last fiscal. "During the last fiscal, our occupancy rate was 55 per cent, whereas this year it has gone up to 75 per cent, mainly due to the increase in Bengal tourists, growth in business and industry," T Rajendra Prasad, general manager of Dolphin Hotels, said.
"In addition to this, a number of business conferences and several national seminars and workshops were held during the last fiscal, boosting the occupancy rate further," he added.
