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Updated: June 1, 2012 14:59 IST

New hotels beckon the business class

    Liffy Thomas
    Deepa H. Ramakrishnan
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Gone are the days when business executives shuttled between the boardroom and the company guest house, on official tours. Today, the men in suits simply check into upscale hotels for both work and stay. With several five-star and five-star ‘deluxe' hotels coming up, the city is fast becoming a favoured Meeting, Incentive, Conferences and Exhibition (MICE) destination.

Thanks to a boom in the automobile industry, IT-ITES and pharmaceutical sectors, city hotels are finding new clientele among top executives of firms. The fact that new hotels cater to their specific needs with more technical facilities, banquet halls and conference rooms, has helped.

Hotels that will change the façade of the city include the ITC Grand Chola, The Leela Palace, Park Hyatt, JW Marriott and Westin. Park Hyatt and Westin will come up on Velachery Road in Guindy this year. The skyline of MRC Nagar will also get a facelift with beach-facing hotels such as Leela Palace coming up there.

Among the five-star ‘deluxe' hotels, the ITC Grand Chola is set to open soon. Sources say it has already begun a trial run for the launch. Spread across eight acres, its luxury serviced apartments and the lights that lit it up in the night sky are already the cynosure for commuters taking the busy stretch.

Among the many firsts at the hotel is its cutting-edge technology that deviates from standard solutions and employs one-of-a-kind technology, including iPad-controlled mechanism in all rooms,” said hotel sources.

In the three and four-star category, the competition gets more exciting. Sarovar Hotels and Resorts is coming up with three properties by 2014, Empee group's Grand Orient is also looking at opening its Anna Salai property within the next one-and-a-half years.

According to sources in the hotel industry, in the last 15 years, a large number of five- and five-star ‘deluxe' hotels have opened in the last two years.

According to M.P. Purushothaman, president of South India Hotels and Restaurants Association, the city has 17 five-star and five-star ‘deluxe' hotels with 2,595 rooms. Another five with 1,550 rooms are coming up by 2013. Given the volume of inventory entering the hotel market, occupancy levels are expected to come down, said a study by HVS Global Hospitality Services.

But hoteliers are not ready to buy that. “There is still a shortage of rooms and when the inventory is more, demand is also more. I see more scope for three- and four-star hotels,” said Mr. Purushothaman.

New destination

Till now, as a MICE destination, Chennai has not been able to conduct many mega conventions due to lack of rooms. Though the Chennai Trade Centre has been able to offer space for holding conferences with 1,000-1,500 delegates, the lack of more options has always been a lacuna. Now, ITC Grand Chola and The Leela Palace have hall capacities of 1,500 plus.

“Our one lakh square feet of banqueting and convention facilities, include a 30,000-square feet pillar-less ballroom. Preliminary responses encourage us to deem that the facilities have the potential to leverage Chennai as the new convention destination of India,” said a source in ITC Grand Chola.

R. Rangachari, Advisor, South India Hotels and Restaurants Association, says MICE is a tourist segment that aids a ‘trickle down' effect. “There will be families of conference delegates staying in hotels. There will also be pre- and post-conference sight-seeing tours. The city will get better mileage and investments would also improve,” he added.

“Though new hotels have come up, the old ones have been able to retain their occupancy rates. It means that the supply is fuelling the demand,” said Pascal Dupuis, General Manager, The Leela Palace, which is slated for inauguration sometime in August.

And hotels have their own marketing teams that keep track of major events that shift from one city to another and that travel across the globe. They also tap corporates for company-specific meets and also medical and scientific associations for their annual conferences. Hotels offer special discounts to MICE clients due to the large volume they bring in.

An industry source says that a convention bureau will help generate a good art and culture exchange platform and will position the city and State strongly in the global landscape.

However, any discounts that are offered seem to be nullified by the levy of luxury tax on the actual room tariff rather than what is offered to the guests. “Even if you offer a special rate, the committee which organises the conference has to pay luxury tax on the actuals. That's where we take a beating when compared to similar MICE destinations. If this is changed it could make all the difference,” said M.K. Ajit Kumar, President and CEO, Global Conference Management Group.

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