Hotel developer Chalet Hotels has activated cost-saving measures as it looks to minimise the impact on its business from the West Asia conflict.
However, there is no slowdown in capex or the company’s growth plans, said Chalet Hotels managing director and CEO Shwetank Singh.
The conflict has had one unintended consequence too. Refurbishment of rooms at the Marriott hotel in Whitefield, Bengaluru, and the Westin Hotel in Hyderabad has now been accelerated following a big drop in occupancy in those properties.
“We have a brilliant asset management team and our relationship with hotel operators is very good. We activated contingency measures quickly,” Singh said. Chalet Hotels has cut down on discretionary spending and is not filling up posts that fall vacant due to normal attrition. To save power and utility costs, it has decided to switch off lights on vacant floors in hotels in Bengaluru and Hyderabad.
The company owns 11 hotels and resorts which have over 3,300 keys. A majority of them are managed by international chains such as Accor and Marriott.
Singh said the company’s growth plans remain on track. “From an ambition and capital availability perspective, there is no slowdown,” Singh said. The company is also engaged in talks for inorganic growth opportunities.
This year the company expects to open a Taj hotel at Delhi airport. “We expect to launch 100 rooms this year and the balance 250 rooms at that hotel should also come up soon afterwards,” he said.
Weddings, events lift sales
Singh said that, like the overall industry, Chalet Hotels’ business too was impacted due to the conflict. Around 40 per cent of the company’s business comes from foreign tourists and within that, 75-80 per cent depends on travellers coming via West Asia. “In the initial days the impact was higher but now with rerouting of flights, travel has resumed,” he said.
On the positive side, Chalet-owned hotels have been able to host social gatherings and weddings that were originally planned in the Gulf region. Advance bookings for weddings and events too have increased, he added.