JB Singh, President and CEO, InterGlobe Hotels, speaks about expansion plans and the trends in hospitality
With India still being severely under-penetrated in terms of quality inventory, InterGlobe Hotels aims to increase its footprints in novel territories and densify in key markets.
What are your expansion plans in India market and internationally? What kind of investment are you looking at? Which are the regions that you look for expansion?
InterGlobe Hotels, a JV between InterGlobe Enterprises and Accor, has invested around Rs. 2,700 crore in India since 2004 and has 18 operational properties. Our current inventory is 3,808 keys and we are further investing another Rs. 500 crores to develop five more hotels with around 800+ keys in an active stage of development. Once operational, our total inventory would be around 4,500 keys by 2024. We have a presence in 13 cities, and we have a solid pipeline ahead as we open our new-gen hotels over the next three years in Bengaluru Hebbal, Thane, Bengaluru City Centre, Goa Vagator, and our 5th ibis in Mumbai in Kalina.
This portfolio of hotels represents one of the most sizable financial commitments in the mid-market segment by an Indian corporate entity and an international hotel brand. Our immediate focus is to operationalize 4,500+ keys and continue with our long-term endeavour to grow this network. We remain committed to increasing our footprint by densifying in key Tier – I cities and making strategic investments in growing Tier –II markets.
We are not looking for any international markets to grow as India itself is a massive market, and it is severely under-penetrated in terms of quality hotel rooms.
With the pandemic hampering the hospitality segment, has the pace of expansion slowed down?
The two rounds of lockdowns announced across the country and the health and safety situation in the last 18 months did have some impact on the pace of construction, but our teams have worked hard to cover up the time lost, and we are proud to say that there is no major impact on the planned openings.
Right at the outset of the first lockdown last year, we worked on our business continuity plan to mobilize the labour force and make the necessary arrangements to resume the site operations after the unlocking. There were even other challenges with the supply of goods and materials and even the guidelines permitting to resume the site work leading to some delay, but we worked with all stakeholders to ensure this whole process was dealt with and mitigated in the right manner to ensure the site work was back on track.
Our development timelines in any case have a buffer period for any unforeseen delays and the scheduled opening of our three hotels which are due to open next year fit into the permissible timeframe and we have enough time to cover up for the lost time.
By when do you see the corporate and MICE segment bounce back?
While most of this business has been driven by a strong pull from the leisure travellers, there has been a strong growth in the corporate travellers as well. Our business hotels are witnessing a very improved demand as most business sectors like Manufacturing, Pharma, IT/ITeS and SME’s have started work related travel and the room sales have been on a continuous upward trend.
The revival is also clearly visible in the MICE segment as after the pandemic while there have been restrictions on the number of gatherings for social banquets, our hotels were able to design a wedding product with a special campaign called [email protected] We have already hosted over 200 social gatherings which is incredible and from a demand point of view.
Soon business is looking very promising in properties which are in premier corporate destinations like Mumbai, Gurgaon, Aerocity, Chennai, Bengaluru and even in the tier II markets with support from the local market accounts and regional corporates.
Has the pandemic impacted or forced changes in hotel designs or in terms of revenue strategies?
Our design story is not something new which has been pushed down on us by the pandemic. Even prior to the pandemic our hotels have always been planned with a Future-Minded approach as we aim to make our hotels more rigid and lean which helps control energy consumption, maintenance, and manpower requirements.
We consciously try to stay ahead of the latest design trends and our aim is always to ensure that our latest hotel is designed more thoughtfully than the previous one and we continuously improve upon them with every new opening.
Our continuous focus has been on improving the methods of building our hotels as we have experimented with pre-cast construction techniques and new age construction equipment’s, materials, furniture, and fixtures. We continue to raise the design benchmark of the smart economy hotels India with high quality buildings, state of art design, efficient operations, all of which are totally focused on the new emerging Indian traveler.
How has technology enhanced the customer experience and efficiency over the last couple of years? What kind of technological investments are you looking at?
As the world is converging digitally, I strongly believe that Industries need to coexist and must be able to intersect and connect with each other to remain relevant and enhance customer experience.
During construction, we rely on technology to bring down costs and improve our time to build. An example of this is the building information modelling which brings us efficiencies in engineering coordination. Technology is also helping us in better scheduling and construction management. In one of our upcoming hotels, we are using technology for energy reduction in the ventilation and air-conditioning systems. We are also exploring a new Energy Control Building Management System which would help our team identify operational energy conservation methods based on data analytics.
Our teams have been focusing on cutting-edge tech-integration in numerous aspects of our operations right from e-audits, revenue management, sustainability practices, central procurement, and centralized finance processes. We have already implemented an interactive property management system which links all key departments and guest interfaces to ease operations that can be monitored and reviewed, cementing a balance of manpower even on high occupancy days. We intend to overhaul the whole revenue management system with a comprehensive single platform with a dynamic pricing solution for room rates, additional sales channels, credit management and price listing across different OTAs.