epages News [Restaurants, May 2003]

• Indian American women call the hospitality shots
• Unison Hotels eyes southern market
• McDonald's happy meal on Delhi Metro
• Local Le Meridien may not feel heat from UK crisis
• Mars restaurants to bake cakes for middle class
• Radisson bullish on the south, plans new hotels
• Residency to manage Ritz now
• Business hotel chains all set to go it alone down south
• Taj group puts Chiplun and Nashik hotels up for sale
• 5-star a 4-letter word during slump
• Park Hotel ties up with Design group
• Oberoi in marketing tie-up with Four Seasons & Hilton
• India claims a third of Asian hotel deals
• Back to Restaurants Archives

Indian American women call the hospitality shots

May 01, 2003: California: Indian American women are slowly carving a niche for themselves in the Asian-dominated hotel industry in the US, and this was evident at the annual conference of a hotel lobby. At the women’s panel organised at the Asian American Hotel Owners Association (AAHOA), female members of the industry patted themselves on the back and discussed ways to scale further heights. Indian American families own 35-40% of hotel-motel properties around the US. Despite their importance and their illustrious careers, very few women have made it to the board or as regional directors at AAHOA.

Unison Hotels eyes southern market

May 05, 2003: New Delhi: Unison Hotels, the group which owns Delhi's The Grand Hotel, plans to consolidate its presence in the domestic market and is aggressively looking at acquiring or building new properties in Chennai, Bangalore and Goa.

Umesh Saraf, MD, Unison Hotels said "We have developed all our luxury hotel properties from planning stages to operational running. Now we are keen to acquire luxury business hotels in cities like Bangalore and Chennai. We are also keen on options in Goa. Our group has been actively looking at expansion in the luxury hotel segment in India and soon we will announce a detailed road map for the domestic circuit." Recently, The Grand New Delhi cancelled its management contract with Hyatt Hotels. It now operates the hotel on its own and plans to carry on with this arrangement for the time being.

McDonald's happy meal on Delhi Metro

May 06, 2003: Fast food conglomerate McDonald has unveiled a special package for children taking a joy ride on Delhi Metro rail. Titled ‘Gaadi Bula Rahi Hai’, the Kids Day Out package is targeted primarily at schools and large user groups. As part of the fast food major’s tie up with Delhi Metro Rail Corporation (DMRC), on offer is a combination package of Rs 99. The combination package provides children the pleasure of a joy ride on the Metro followed by a McDonald’s happy meal, a soft serve cone and a complete McDonald’s restaurant tour. The children will be accompanied by a Metro rail executive on the joy ride as part of the programme.

Local Le Meridien may not feel heat from UK crisis

May 07, 2003: Mumbai: Even as Le Meridien Hotels UK teeters on the edge of a financial crisis, Meridien hotels in India are unlikely to be impacted, industry sources say. Le Meridien has six hotels in India across New Delhi, Mumbai, Bangalore, Pune, Chennai and Cochin. Two more hotels — one each at Jaipur and Ahmedabad — are under construction and will be operational this year end. However, in India, Le Meridien operates on a management and franchise model with no assets or investments. Of the 140 hotels globally, Le Meridien has investments only in Europe and owns 35-40 hotels across the European region including the UK. Le Meridien was originally a French hotel company owned by Air France. It was sold off by the airline to the Forte group of hotels in ’95. Forte group then sold off the hotel company in ’97 to UK media giant Granada group. And Granada in ’99 sold it to the Compass group.

Mars restaurants to bake cakes for middle class

May 08, 2003: Mumbai: The Mars group of restaurants, owned by Sanjay Narang, is rolling out a retail venture called Cake Khazana, a cake and a confectionery store akin to Monginis and Venus Cakes, targeting the middle class. Plans have been outlined to set up 100 stores across major cities. Cake Khazana will, however, start off with 50 stores in Mumbai over the next six months and then roll out to other cities. There is a huge potential for cakes and confectionery in the mid market segment as there are few players who provide inconsistent taste and poor quality of food products. There is little or no competition.

Cake khazana has set up a centralised manufacturing facility in North Mumbai for Rs 10 crore. The Mars group will, however, not invest in its retail stores. The group’s investment will be limited to supply chain and manufacturing of food products. The group will adopt a dealership route to set up its retail chain.

Radisson bullish on the south, plans new hotels

May 14, 2003: Chennai: The US-based Radisson Hotels and Resorts are spreading its wings to south India, with plans of adding three hotels under its banner. The Radisson group is in advanced stages of negotiations with Hyderabad’s Tulip Manohar for a management contract. In addition to this, the group is in talks to enter into management contracts with private promoters who are in the process of setting up properties in Bangalore and Kumarakom in Kerala.

Sources said Radisson’s gameplan is to consolidate the brand all over the country. The investment required in all three properties is believed to be in the region of Rs 150 crore. Once the three properties are up and running, the Radisson group would have 10 hotels under its management fold. The existing Radisson-run hotels are in Delhi, Goa, Kolkata, Chennai, Varanasi, Vaishno Devi and Jalandhar. Radisson is known in India and worldwide as an airport hotel. The Bangalore and Hyderabad properties are also expected to cater to the transit passengers traffic. It is felt by the hospitality sector that corporates prefer these cities for holding large conferences and other business meetings. The reasons they cite are an investment-friendly climate and rationalised tax regime.

Residency to manage Ritz now

May 15, 2003: Mumbai: The management of the Ritz Hotel, a four-star hotel in South Mumbai, is set to change hands. Hotel consulting group Residency Hotels will take over the management from the existing promoter, Sriram Kapur. Residency Hotels also manages the Resort, owned by construction major, the Mumbai-based Raheja group. It is also a consultant to other Raheja hotel properties in Mumbai under the Marriott brand.

Industry sources said the Ritz would be renovated after which it will be positioned as an upmarket, budget hotel. The hospitality industry in Mumbai is rife with rumours that the Ritz hotel property is being sold to a large Mumbai-based group with interests in construction and hotels.

Business hotel chains all set to go it alone down south

May 16, 2003: Chennai: It looks like a solo ride for business hotel chains. A trend is in the making with a handful of hotel chains striking it out on their own without tying up with illustrious names for brand support and marketing. While hoteliers agree to such a beginning in the growing four-star or business category segment, they still worship global brands when it comes to the premium five-star range. So attractive is the price-driven four-star segment that premium brands like Radisson, ITC, Tulip and Taj are tapping this market. But the trend-setters, perhaps a little unknown outside their territory, are players like Viceroy, Greenpark, Casino, GRT and the Residency group.

With strongholds in south India, these players have established brand equity of their own with over a couple of hotels under their fold. They are holding out on their own even when business segment brands are on offer. Experts say there are number of such hotel chains which operate on their own nationally on tourist circuits. These include players like Mansingh Hotels (Agra, Jaipur and Jaiselmer), the Rahejas, Jaypee Hotels (Agra, Mussoorie), Hans Plaza (Delhi, Bhubaneswar), Southern Star (Ooty, Bangalore, Mysore), President (Indore, Aurangabad) and Fortune (Andaman, Jamshedpur, Ahmedabad, Vapi, Darjeeling).

Taj group puts Chiplun and Nashik hotels up for sale

May 17, 2003: Mumbai: The Taj group of hotels has put its hotels at Chiplun, Nashik and Indore on the block. The Chiplun hotel is part of the Taj group’s Gateway Hotels division while the Nashik and Indore properties carry the ‘Residency’ brand. HSBC Securities has been retained as advisors to manage the proposed sale of these properties. Chiplun is 250 km from Mumbai and became famous due to the Enron power project. The hotel has experienced a dip in revenues after the Enron power plant shut down. Room rates and average occupancy is now less than 50%. The food & beverage (F&B) income which contributed significantly to the topline prior to ‘01 has taken a beating.

Chiplun is described as a 32 room-four star hotel. Industry sources say the Taj group did not find the hotel viable. “It will be a slump sale and all the movable and immovable assets, business operations as well as permits/licences/contracts and employees will be transferred to the buyer,” according to the memo. The 68-room hotel, Taj Residency Nashik, which is also on the block, is marketed as a pilgrim hotel as it is located en route to Shirdi. The proceeds from the sale are not likely to be high. As a strategy, the group is exiting from properties which do not reflect its brand image, industry sources said.

5-star a 4-letter word during slump

May 21, 2003: Los Angeles: Putting on the Ritz does not look so good on a corporate expense account. That is the word from Marriott International Inc, which owns the fabled Ritz-Carlton brand and is struggling with a problem of perception that is deepening the effects of the economic downturn on high-end hotels. There may be worse news for the contracting lodging industry, say analysts, who see luxury hotels lagging a general recovery.

The swankiest hotels have hurt the most recently, especially in rates, which fell 4.2% last year to an average $139.62 at high-end "upper upscale" hotels, compared with a more modest 0.2% decline to $68.23 at mid-scale hotels, the most robust business category, according to data by industry tracking service Smith Travel Research. The luxury hotels have divided into two camps on price. One, including the Palace, has maintained rates, arguing customers who get a discount in bad times will come to demand one when conditions improve. The other, which includes New York's Waldorf-Astoria, owned by Hilton Hotels Corp, has lowered rates, arguing they can maintain cachet so long as they maintain service.

Park Hotel ties up with Design group

May 21, 2003: Bangalore: The Park Hotel chain has tied up three of its properties with Design Hotels in a bid to consolidate its average room rate with international travel industry.

The Kolkata, Chennai and Bangalore properties have become members of Design Hotels, which markets hotels with a distinct identity.

Oberoi in marketing tie-up with Four Seasons & Hilton

May 22, 2003: The Oberoi group of hotels is tying up with multinational hotel chains Four Seasons and Hilton for co-branding and marketing of its properties. According to sources close to the Oberois, while the Hilton tie-up is for the Trident chain of hotels, Four Seasons would be associated with the Oberoi brand. However, in Mumbai, the Oberoi Towers would be with Hilton, while the Oberoi would be with Four Seasons. Sources also said that currently it is a strategic marketing alliance but there is an option for either or both of these chains to pick up equity stake group in the future. Four Seasons has chosen to wait-and-watch how the tourism potential unfolds in the country before deciding to buy any equity, according to the sources the partnership with Four Seasons would cover Oberoi properties in New Delhi, Chennai, Kolkata and Bangalore, besides the one in Mumbai.

While properties in the country would be co-branded, negotiations are on over which brand would be mentioned first. The tie-up with Four Seasons is expected to give the Oberoi hotels access to the global marketing network of the premium Four Seasons chain and attract the clientele with high purchasing power. Rival ITC Hotels today enjoys a competitive advantage due to the long-standing arrangement with Sheraton. Sources added that a common team marketing both the Oberoi and Trident brands may have its positioning issues to deal with. Separating the two could now make marketing more effective.

India claims a third of Asian hotel deals

May 28, 2003: New Delhi: India’s hotel industry saw transactions worth Rs 1,100 crore in ’02, including the sale of a few ITDC and HCI properties as well as of The Regent in Mumbai, compared to around Rs 3,200 crore ($670m) worth hotel sales across Asia. Japan and Hong Kong also emerged as the hotspots for investment activity. Asia’s total volume of hotel transactions during ’02, however, fell 50.4%, when compared with ’01. This survey provides a comprehensive analysis of 22 major hotel markets spread over 12 countries in Asia.

Centaur Juhu, Centaur Airport, Kanishka, Ranjit, Hotel Madurai Ashok, Temple Bay Ashok Beach Resort, Laxmi Vilas Palace, Qutab Hotel, Lodhi Hotel, Hotel Airport Ashok in Kolkata, Kovalam Ashok Beach Resort, Hotel Manali Ashok, Khajurao Ashok, VaranasiAshok, Aurangabad Ashok, Hotel Indraprastha were sold by the government last year to private parties. The Regent in Mumbai was also sold in ’02. According to Jones Lang LaSalle Hotels, in ’02, all major hotel sales across Asia comprising 5,465 rooms crossed over $670m. During ’02, Jones Lang LaSalle Hotels’ database recognised $3.6bn worth of hotel transactions in the US and a further $5.3bn worth of deals in Europe. A report said, ’02 was an encouraging year in terms of hotel transactions and acquisition of debt, particularly in Japan. A rising number of bankruptcies and the restructuring of companies under pressure by creditors spurred activity in this historically illiquid market. The markets of Tokyo, Beijing, Bangkok and Shanghai are current investor favourites. With the prevailing SARS situation in Asia, general sentiment has been affected, particularly that of investors from Singapore and Hong Kong.