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Desperate times birth the new flexi hotel

Over the weekends, the resort’s 31 rooms are nearly all booked. The occupancy drops to a third on weekdays. It has been this way since August. When the resort restarted after the lockdown in June, the rooms were discounted. A confident management firmed up prices over the next several weeks. Now, a room can cost 10,000 a night over the weekends.

“We have recruited 13 people since August 15. We declared a bonus for the months of July and August for every employee, right from the gardener to the vice president,” Nath, a director at Karma Chalets said. “However, we still haven’t prepared a budget for the year. We are just going with the flow,” he added.

The resort may seem like an aberration, but it is not. Resorts and branded hotels that are at motorable distances from cities are seeing a huge spike in demand driven by a phenomenon called ‘revenge tourism’. After being locked up for six months, people want to splurge — in places that are perceived to be safer.

So, WelcomHeritage’s resort in Coorg, Ayatana, about five hours drive from Bengaluru, is running at 80% occupancy. Aurika, Udaipur, a resort by Lemon Tree Hotels, has good demand from denizens of Ahmedabad. Resorts run by The Indian Hotels Company Limited (IHCL) in Rishikesh, Jaipur, Goa, Madh Island (Mumbai), and Lonavala have gained as well.

City hotels have no such luck. There are no international tourists and no corporate travellers. Conferences and exhibitions haven’t re-started yet. And while occupancies and room rates are improving every month, they are still several notches below what it was in the same period last year.

Hotel occupancies averaged about 65% in 2019, a report from Noesis Capital Advisors, a hotel transaction advisory company, and Ngage Hospitality stated. The average occupancy dropped to 9% during the first half of 2020-21. Between March and June, branded hotels lost 80 billion in revenues, the report added.

Leisure destinations seeing demand spikes post the lockdown also have many miles to go. Take Goa and Jaipur, two popular leisure destinations, for instance. Hotel occupancy in Goa averaged about 26% in September 2020 versus 61% in the year ago month. Occupancy in Jaipur averaged 27% in September this year compared to 66% the year ago, data from HVS Anarock, a hospitality advisory group, showed.

To survive, branded hotels are picking up all sorts of business and are exploring revenue streams that did not exist earlier. Milking domestic tourists is high on the agenda. So is monetising real estate, focusing more on high-value Indian marriages, making digital pivots when it comes to food services.

All five-star hotels were wary about home delivery of food. The lockdown has changed all this. Luxury hotels now have their own food delivery apps. Some have opened the doors to laundry services for anyone in the city, even.

Meanwhile, undercutting of room rates is rampant in city hotels. All of a sudden, those who could afford three or four-star hotels in good

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