'Industry Performs but Concerns Over Occupancy Remain,' Says JLL Research

With room rents remaining upwardly stable, occupancy levels in cities such as Ahmedabad, Goa and Pune declined during January-June 2019 period   

• Nine out of top 11 markets witnessed a rise in RevPAR performance during this period; Mumbai ranked on top in absolute terms; Hyderabad led in RevPAR percentage change
• Of the top 11 markets, 10 witnessed a rise in ADRs during this period; While Bengaluru ranked on top in ADR percentage change terms, Ahmedabad remained an exception
• Gurugram led in occupancy growth change
• While Budget Brands looked promising, upscale and midscale hotel brands have contributed the maximum to signings

NEW DELHI, July 30, 2019 /PRNewswire/ -- Long election season spanning all over April and May, grounding of Jet Airways causing last minute flight cancellations and expensive alternate itineraries, followed by a harsh summer and travellers opting for overseas travel during holiday season have together contributed to reduction in occupancies across hotel segments and across key Indian cities. Decline in occupancies was more visible in key cities including Goa, Pune and Ahmedabad, according to the Hotel Momentum India (HMI) - H1 2019, the half-yearly hospitality monitor (for January to June 2019 period), released today by JLL Hotels and Hospitality Group. 

However, thanks to upwardly stable Average Daily Rates (ADR), the hotels continued to maintain momentum during these first six months, the HMI added. At the country level, nine out of the top 11 markets witnessed a marginal rise in RevPAR performance during this period. In RevPAR percentage terms, as compared with the corresponding period the last year, Hyderabad ranked on top. Bengaluru and Gurugram followed on the second and third rank, it said. Mumbai, however, is the RevPAR leader in absolute term. 

"First three months of the year (January to March) continued to perform well on back of winter season, which is conducive for leisure travel into India. Business travel also remained strong. But subsequently, problems relating to Jet Airways and a long election season (April to June period) forced travellers to change or defer their travel plans. Last-minute flight cancellations and expensive re-ticketing forced people to look at alternative economical international destinations. This impacted the performance of cities such as Goa and Jaipur, and also business markets such as Pune and Ahmedabad. Despite these challenges, top cities have performed decently during the first six months of the year," said Jaideep Dang, Managing Director of JLL India's Hotels and Hospitality Business.

"We expect the room rents to remain stable in the future. Few cities, however, which are high on tourism radar and are business-wise important, are likely to see an upward movement in rents. This trend is likely to keep the performance and growth of the sector intact in coming quarters too," he added.

The HMI further added the country has seen a rise in branded hotel signings in the first six months (Jan-June) of 2019. During the period, the country witnessed a total of 85 hotel signings, comprising of 8,612 keys. While budget brands looked promising in 2018, upscale and midscale hotel brands have contributed the maximum to the signings during the first half of the year, according to the half-yearly update.

"Despite the fact that real estate market in the country is going through a difficult phase, new hotel signings suggest that there are businessmen and entrepreneurs from other trades who are investing in hotels given its long term potential," Dang added.

Click here to download the HMI

About JLL India

JLL is India's premier and largest professional services firm specialising in real estate. With an estimated revenue for FY 2018-19 expected to be approx. INR 4,000 crore, the Firm is growing from strength to strength in India for the past two decades. JLL India has an extensive presence across 10 major cities (Mumbai, Delhi NCR, Bengaluru, Pune, Chennai, Hyderabad, Kolkata, Ahmedabad, Kochi and Coimbatore) and over 130 tier II & III markets with a cumulative strength of close to 11,000 professionals.

The Firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services. This includes leasing, capital markets, research & advisory, transaction management, project development, facility management and property & asset management. These services cover various asset classes such as commercial, residential, industrial, retail, warehouse and logistics, hospitality, healthcare, senior living and education.

JLL India won the Five Star Award for 'Best Property Consultancy at the International Property Awards Asia Pacific 2018 -19. The Firm was also recognised amongst the 'Top 100 Best Places to Work in India' in 2017 & 2018 in the annual survey conducted by Great Place to Work® and The Economic Times. It has also been acknowledged as 'Property Consultant of the Decade' at the 10th CNBC-Awaaz Real Estate Awards 2015.

For further information, please visit jll.co.in

Media Contact:
Devesh Srivastava
[email protected]
+91-9910431445
Head- Public Relations & Content
JLL India

Logo - https://mma.prnewswire.com/media/678101/JLL_Logo.jpg