A Tale of Three Markets
Research courtesy: Cushman & Wakefield
Bhubaneswar commonly referred to as the ‘Temple City of India’ is the capital for the state of Odisha. Located along the eastern coast of the country, Bhubaneswar spans over an area of 419 Sq. Kilometers, and lies in the district of Khordha. The district is home to a population of over 2.2 Million People of which 50% is urban population, experienced a decadal growth of 34.13% since 2001 to 2011. Economically the district has seen an average annual growth rate of 10.6% in gross district domestic product (GDDP) from 2005 to 2009, as of 2008-09 the GDDP for the state was recorded at over INR 1.0 million. The city is host to a number of upcoming IT parks such as Infocity-1, Infocity- 2 companies such as TCS, Wipro, IBM, Genpact, First source, Mind tree.
As per the hospitality segment, occupancy over years has seen significant growth in Bhubaneswar, as of 2012, the occupancy was estimated to be approximately 65%, having grown 5% over the previous year. Average room rates have also increased by 1% in 2012 to approximately INR 3340. Approximately 70% of the occupancy in Bhubaneswar is from domestic clientele. Majority of the guests visiting are for business, where the clientele comprises almost 60% of room nights sold.
Currently the total existing supply is approximately 1447 rooms, of which the budget segment forms a majority of the existing inventory at 40%, followed by 30% in the Midscale segment, 26% with Upscale and 4% in the Upper Upscale segment. Currently existing are a few branded hotels such as Ginger, Trident, Hotel Hindustan International, and Mayfair. Additionally, supply is expected to grow by 28% over the next 5 years, with brands like Hyatt, Radisson, Sarovar Premier and more investing their brands into the city. Most of these hotels are present within the city centre which has a large concentration of temples and represents the older city, which is preferable for the tourist traveler.
Bhubaneswar is better known as a pilgrimage destination. Some the most notable landmarks in Bhubaneswar include locations such as the Konark Sun Temple (also a UNESO World Heritage site), which in 2010 accounted for the maximum number of tourists for over 1.9 million tourists which had seen a year on year growth of 10% tourists in 2010. Other tourist attractions include Raja Rani Temple, Udaigiri and Kandagiri, excavation sites of Ratnagiri and Lalitagiri, which together drew a total of more than 4.7 lakh tourists and had seen a year on year growth of 13% since 2009.
The city, over the past few years has also seen a number of commercial developments, which have accounted for a rise in business travelers visiting the city, with almost 60% of demand being contributed towards room nights by corporate travellers.