Pune: Two 5-star hotels up for sale, few looking for new owners

Two famous five-star hotels have become the latest victims of Covid-imposed limitations in Pune, with their managements declaring that they are unable to run them any longer due to a severe financial constraint and an unclear future.

Pune: Two 5-star hotels up for sale, few looking for new owners

Two famous five-star hotels, one in the Bund Garden region and the other in Hinjewadi, have become the latest victims of Covid-imposed limitations in the city, with their managements declaring that they are unable to run them any longer due to a severe financial constraint and an unclear future.

Members of the Poona Hoteliers' Association (PHA) confirmed the situation, saying that in addition to these two properties, managements at another four-star hotel on MG Road and three-four-star hotels in other major areas were seeking new operators to handle the properties.

Some star hotels in Pune are on the market, with a five-star hotel in Hinjewadi apparently on the market for more than Rs 200 crore. We've heard that some of the larger hotels' stakeholders are shifting. Hinjewadi is in a poor state, and most of the hotels in the region are closed, on the verge of closing, or being sold off,” a PHA source said.

According to sources in the hospitality industry, an online search for "hotel properties for sale" yields numerous results for hotels in Pune, Lonavla, Mumbai, and even Goa. They are worth crores of rupees on the market. “Many of these houses have been on the market for four to five years and have massive debts to pay off. As the economy has yet to recover to pre-Covid levels, it will take time for anybody in the market to purchase off some of these properties,” a city-based hotelier said.

Several hotels have yet to open during or following the second wave. “A few of them did open last year in November and December, but they were closed for the second wave. Many hotels have been operating at a 10% occupancy rate.” Another hotelier in the city remarked, "It's a big hardship to open with significant operational expenditures."

At least four hotels were unable to reopen during the epidemic, according to a hotelier from the Hotel and Restaurant Association of Western India (HRAWI), with one using part of its portion as office space. “Losses from repeated restrictions were one of the primary reasons, exacerbating the situation for some owing to competition from newer hotels that have sprung up in recent years.”

Commercial business travel, he added, was practically non-existent, with medical representatives' conferences, training, and exhibits at hotels going to nought.

Maharashtra, according to industry experts, has approximately 10,500 hotels and 2,10,000 eateries. “In the last 15 months, nearly 30% of hotels and half of the total restaurants, or approximately 3,000 hotels and 1 lakh restaurants, have closed,” an HRAWI source said, adding that of the 50 lakh employees directly employed in the industry across Maharashtra, over 25 lakhs have already lost their jobs due to Covid-induced restrictions and consequent business losses.

Due to recurring limitations, the hotel industry has demanded a total exemption from all statutory fees and taxes, as well as the elimination of water and energy bills for the period of the restrictions.

Source: Times of India