Hotel rates, air fares soar for Christmas, New Year

Almost all star-rated hotels in the tourist hotspots of Goa, Kerala and Rajasthan are reporting total sellout of room inventory for New Year's Eve, even though hospitality rates for that period have been more than doubled.

Top properties of brands such as the Taj, Leela, Marriott, Hyatt, Oberoi and Holiday Inn, to name a few, have seen a substantial jump in room rates across locations frequented by tourists.

Most of these properties, with starting charges of Rs 26,000 per night, accept minimum bookings of three to five night stays, with almost no refund in case holiday plans do get cancelled.

For instance, the cheapest room at the five-star Taj Exotica in north Goa costs Rs 46,500 per night (excluding taxes) during the year-end. The penalty charge for cancellation is 100 per cent. The average rate otherwise charged by the hotel, run by Indian Hotels Company, the biggest in the sector, is Rs 20,000-21,000 per night.

Vivanta by Taj has raised rates more than three times at its property at Fort Aguada, north Goa. The going rate at the property is Rs 35,667 a night, against the usual Rs 10,000-11,000 per night.

Mumbai-based luxury hotel chain operator Hotel Leelaventure opened 20 additional rooms and a new restaurant at its property in Goa, taking the room count to 206, with four restaurants. The expansion was done at a cost of Rs 100 crore ($20 million).

Morton Johnston, general manager, The Leela Goa, said, "Christmas and New Year's is always the busiest time of the year in Goa. We are sold out for New Year's; in fact, there is a waiting list on it. Christmas is also selling fast, with just a few rooms available."

Foreign

guests at this time would constitute the bulk of Goa's tourist traffic and they do not mind paying high room rates, especially since the Indian currency has depreciated substantially over the past two months.

Oberoi Hotel's twin properties in Rajasthan, Udaivilas and Vanyavilas, have been completely sold for New Year's Eve. Rrooms at new properties such as the Holiday Inn at Goa are also filling quickly, with the asking rate being double at Rs 18,000 a day than the regular rate of Rs 9,000.

Airlines, too, have increased fares. Jet Airways, the country's biggest, is charging Rs 16,500 for a one-way, Mumbai-Goa economy-class ticket.

Even low-cost airlines like IndiGo and GoAir are charging fares in excess of Rs 10,000. The regular fare on this route is Rs 3,000-6,000.

Air India subsidiary Alliance Air will be operating additional flights on the Delhi–Goa–Delhi sector from December 22 to January 10 to meet the increased demand during the season.

"Hoteliers increase rates at this time of the year to cash in on the heightened demand. The rates are usually more than double their usual ones and help soften revenue loss during the lean season," said a Bangalore-based executive of a hotel company.

However, hotel companies say the increase in rates will not have much of a positive impact on the overall finances, as demand had been under pressure in earlier months, forcing them to avoid substantial raises in room rates.

Anil Madhok, managing director, Sarovar Hotels, said, "The overall increase in business is still 80 per cent of what we had predicted. The weak economic scenario and even weaker sentiments are impacting the hospitality business. This increase in prices of rooms will not offset the dip in demand of the earlier period."