Domestic travel will continue to aid recovery for hotels in 2021: JLL
India’s hospitality industry witnessed a decline of 54.9% in RevPAR during January to December (CY 2020) as compared to CY 2019, according to JLL’s Hotel Momentum India (HMI) Q4 2020, a quarterly hospitality sector monitor.
Mumbai, 15 February 2021 – India’s hospitality industry witnessed a decline of 54.9% in Revenue Per Available Room (RevPAR) during January to December (CY 2020) as compared to CY 2019, according to JLL’s Hotel Momentum India (HMI) Q4 2020, a quarterly hospitality sector monitor. With the revival of domestic travel, emergence of recovery indicators has come to the rescue of the sector.
The recovery of the sector has been primarily driven by leisure ‘revenge travel’ during weekends, festival season, weddings and demand of food & beverage.
Total number of signings in Q4 2020 stood at 45 hotels comprising of 4,326 keys, recording a decline of 43.6%, compared to the same period last year. International operators dominated signings over domestic operators with the ratio of 57:43 in terms of inventory volume.
Q4 2020 Performance Trend Chart
Goa grew to be the RevPAR leader in absolute terms, despite a decline of RevPAR by 33.3% in Q4 2020. Demand for domestic leisure travel amidst international travel restrictions has made Goa the fastest recovering market in absolute terms. Bengaluru saw the sharpest decline of 77% in RevPAR in Q4 2020 compared to the same period in the previous year. However the city has witnessed a month on month growth in performance during the last quarter of 2020.
“We are already seeing signs of domestic business travel pick up in the new year. We expect that occupancies in business hotels will ramp up from March/April 2021 onwards as companies gradually lift travel embargo. Furthermore, domestic leisure travel will continue to drive occupancies across the country. F&B demand will continue to grow as eating out will increase albeit cautiously. We also expect investment activity to restart with serious investors evaluating quality assets on back of performance cycle uptick” said Jaideep Dang, Managing Director, Hotels and Hospitality Group, South Asia, JLL.
To help revive the sector by way of various benefits such as rebates in electricity charges as well as property taxes, Government of Maharashtra recognised hospitality sector as an industry. Further, the government decreased number of permissions required to start a new hotel or a restaurant to 10 from 70. The Atmanirbhar Bharat 3.0 measures announced by the government included the launch of ECLGS 2.0-Guaranteed Credit for supporting the 26 stressed sectors identified by the Kamath Committee.
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion, operations in over 80 countries and a global workforce of operations in over 80 countries and a global workforce of more than 91,000 as of December 31, 2020. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com
In India, JLL 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 12,000 professionals. Headquartered out of Mumbai, we are India’s premier and largest professional services firm specializing in real estate. Our services cover various asset classes such as commercial, residential, industrial, retail, warehouse and logistics, hospitality, healthcare, senior living, data centre and education. For further information, please visit jll.co.in.