With a plethora of luxury hotels opening in Chennai, India, we directed our minds and pens towards the city to figure out the reason behind this sudden spurt...
By: Karishma Suri
Posted on: January 20, 2014
With a plethora of luxury hotels opening in Chennai, India, we directed our minds and pens towards the city to figure out the reason behind this sudden spurt…
Chennai, often called the cultural capital of India for its deep-rooted traditions and heritage, is a city that should be explored for its mystery, charm and persona. Chennai is a city younger than its image, or so they say. More than any other city in India, it is a true reflection of this country’s diversity. In a time span of just over 350 years, Chennai seems to have blossomed into a charming city that has a large, welcoming heart. And welcoming in a more luxurious way are the luxury properties establishing themselves in Chennai.
Tier 1 cities like Bangalore, Hyderabad, Coimbatore, Chennai, Cochin and others have opened to the new phase of ‘glocalization’, where the FDI friendly government policies have attracted large MNC investment in these markets. Why?
A sudden popularity
"Chennai was a ‘sleeping monster’ in terms of luxury brand presence. This city has always had the potential to expand. The younger affluent population is ready to splurge. The spending power in the city is amazing. Around 80 per cent of the business here is cash and carry," said Mr Shrikant Wakharkar, General Manager, The Westin Chennai Velachery.
Today, seven of the top 20 global auto makers have their base set-up in Chennai to earn it the sobriquet of ‘Detroit of India’. Chennai accounts for 27 per cent of India’s automobile industry and 45 per cent of the auto components industry in India. In the last 15 years or so, Chennai has become an attractive destination for foreign direct investments (FDI). Industry-friendly government policies, proximity to the port and a traditional engineering base promise great growth and travel movement in the city, which benefactors hospitality supply and demand scenarios. Chennai has become home to many national and international businesses and factories. Software services companies contribute to 14 per cent of India’s total software exports. In fact, the Tidel Park in Chennai is the largest IT Park in Asia. Chennai is an important center for banking and finance, medical tourism, film and TV industries. So that's Chennai for you today…
Making a mark with its sophisticated style, instinctive service, and local and international cuisine, The Westin Chennai Velachery is a highly anticipated addition to the portfolio of five star hotels in the city of Chennai. "We believe that business travellers, meeting planners and individual travellers will be delighted with the Westin emphasis on well-being and the innovative signature services that have earned Westin worldwide recognition," said Mr Wakharkar.
Ask Mr Pascal Dupuis, General Manager, The Leela Palace Chennai, and he says, "Chennai has witnessed a paradigm shift in the luxury landscape. With brands like Louis Vuitton, Cartier, Ducati, Canali, Harley Davidson, Jimmy Choo and major auto brands making a foray in the city, Chennai’s potential as a luxury destination is recognized the world over. In the hospitality segment alone, in the year 2010-2011, there were merely 496 rooms inventory, whereas, in 2013 the number has gone up to 2325. In a city that predominantly had Indian chain of hotels, we have witnessed an influx of many international brands such as Hilton, Hyatt and Westin. Additionally, at The Leela Palace Chennai, we have paid special emphasis on bringing F&B chains having culinary offers of international standard to provide a seamless blend. Further, with the new and revamped airport and addition of new air routes, the city is all set to attract international and high-end luxury brands in the hospitality segment."
Chennai’s hotels have witnessed an increasing business demand, which is expected to grow, mainly driven by corporate travel budgets leading to higher business travelers. In addition, the already well-established tourism industry continues to be promoted and facilities improved to increase tourist visitor numbers. The city has recently started segregating into distinctive micro areas, with the regions of Sriperumbudur (Chennai’s industrial hub) and OMR (Chennai’s IT corridor) attracting significant travel, mainly in the budget and mid-market segments. Given the number of existing and new companies setting up their offices in the city and its micro areas, there is a significant extended stay demand, which has resulted in a strong growth of hotel products. New upscale and luxury hotels with extensive meeting facilities have complimented the boost in the MICE demand.
Apart from international corporate honchos, domestic visitors come from Andhra Pradesh followed by Karnataka, Kerala, West Bengal and Bihar. Visitors from Sri Lanka continue to be at the top in the list of foreigners coming to Chennai, followed by visitors from Malaysia, Singapore, the United Kingdom, France and the United States.
"Chennai is seen as a market that is rapidly becoming one of the fastest growing luxury markets in the world with its potential as a luxury destination recognized the world over. The city, that has always been a favourite of the automobile companies, has seen major shift of spend in lifestyle products owing to the young generation and the influx of youngsters from other cities to Chennai," said Mr Dupuis.
Already established hotels like Taj Coromandel are bringing back the attention towards Chennai. The hotel, in association with Apparao Galleries, gives a chance to get intimate with the culturally dynamic city by creating an ensemble of captivating experiences that lure guests to discover more of this city. Explore the nooks and crannies of Chennai as a guest of Taj Coromandel. Venture through the city’s secrets – uncovering hidden treasures, rich textiles, timeless jewellery, a vivacious art scene and fine South Indian cuisine. Each of their six tours are unique and handcrafted to offer knowledge, and make your trip to the city truly worth it.
A problem or a language?
Besides language being a barrier, properties have had to establish themselves in more ways than one. Apart from the language training, the staff of Westin Chennai has been in a New Associate Training Program which introduces the new staff to the trained staff within the system. The Buddy System allows the new joiner to get a well-informed understanding on soft skills and technical skills. "The staff at the property is also sensitized with the Starwood’s brand pillar ‘Diversity’- the value that gives an associate an in-depth understanding about local ethics, socio-economic background and traditionalist triggers to operate better," said Mr Wakharkar.
On the other hand, at Leela, cultural orientation is regularly organized where dignitaries hailing from different countries and regions are invited to address the employees on culture-centric nuances.
With many hotels setting up base in the city, is Chennai ready for this hospitality boost? Or is there a demand-supply mismatch? Mr Dupuis explained that the demand and supply curve seems to be slightly skewed and supply has overdone the demand. However, with infrastructural developments taking place, it is seen to be attracting the MICE (Meetings, Incentives, Conferencing and Exhibitions) segment in a major way and the coming years look promising.
Mr Warkharkar said, "Considering the good boost that the hotel has experienced in terms of business, the exceptional guest experience that we continue to offer, and recognition on travel forums like TripAdvisor with our number one position; we look forward to ramping up on our occupancy levels and driving the Average Room Rate. The endeavour would be to exceed our budgets and develop a competitive brand in the present market share."
The ramping up of Chennai as an industrial and financial city, yet maintaining its preserved culture and heritage, has made it a one-of-a-kind destination, which is quite different from other metropolitan cities in India. While a lot of sectors benefit from this development, the luxury hotel sector is seeing quite a lot of activity and growth, and with good reason. And we think it’s not going to stagnate any time soon…