As travel bookings rise, hotel room rates zoom in leisure destinations

“The surge may disappear once international travel resumes later, but as of now we are seeing heavy demand, across our properties in Himachal Pradesh and Uttarakhand,” Prasad said. While tariffs in certain leisure destinations are even breaching pre-pandemic levels, room rates in the metros too have started rising with a gradual resumption of business travel. “Hotel rates in leisure locations are about 2x or 3x of 2019 rates,” said the head of a hotel chain who requested not to be identified. “Rates in a top business hotel in Mumbai have gone up by close to 50 per cent over the past two weeks.” Ajay Bakaya, managing director of Sarovar Hotels, said the chain is now at around 90 per cent of February 2020 levels in terms of rates. February 2020 had hit a big peak in terms of rates, he added. “I don't see them going down again in the near future,” Bakaya said. “It’s time to smile a little.” He said that rates have increased significantly in markets such as Mumbai, Delhi, Chennai, Hyderabad and Kolkata as business bookings are coming back. “There is a lot of bounce back on weddings; April, May, June, July have a lot of auspicious dates,” Bakaya said. “Even Kerala that was lagging behind is beginning to look up.” Nikhil Sharma, , Regional Director – Eurasia at Wyndham Hotels & Resorts, said rates for the chain have gone up in destinations such as Udaipur, Kasauli, Mussoorie, Dehradun, Mumbai, Jaipur, and Amritsar. He said the chain has seen a strong rebound in demand for leisure travel as it has showcased a much quicker recovery, and record numbers at several resorts. “We continue to see domestic demand gain traction, assisting average daily rates to perform better with each presiding week,” Sharma said. “As large corporations and SMEs intend to commence travel, we expect an uptick in occupancy and average daily rates.” Mandeep Lamba, President, South Asia, at HVS Anarock, said leisure markets have been the hotel industry's “shining knight” for the past two years now, pushing recovery after every setback, with rates at several upper upscale and luxury hotels in leisure destinations now surpassing their pre-pandemic rates. “Since international travel is yet to resume, and corporate travel is still restricted and slower to recover after a setback, hotel demand in commercial markets is purely driven by domestic customer mix, comprising a large number of first-time hotel customers, newer segments such as staycations, as well as weddings and the social events segment which continue to support hotel demand,” he added.