The hospitality industry in Mumbai witnessed a decline of 35.5% in Occupancy and a 48.1% decline in ADR, resulting in a 71.7% decline in RevPAR during Q4 2020 as compared to Q4 2019, according the recent Hotel Momentum India (HMI) Q4 2020 by JLL.
However, since the unlocking of the economy in late June, the city witnessed a month on month growth in travel and hotel sector performance during Q4 2020. The sector was driven by staycation demand on the weekends and festival seasons around Diwali, Christmas and New Year’s Eve.
Mumbai’s hospitality sector saw a 58.4% decline RevPAR during January to December (CY 2020), compared to CY 2019, due to the impact of COVID-19. Total number of signings in the city in CY 2020 stood at 3 hotels comprising of 651 keys, recording a decline of 56% in terms of inventory, compared to the same period last year.
“Mumbai saw a significant growth in F&B demand. Given conducive weather conditions of the city, there has been a preference towards open-air restaurants maintaining social distancing norms. Furthermore, the government of Maharashtra decision to recognise hospitality sector as an industry, will help revive it by way of benefits like rebates in electricity charges and property taxes. We are witnessing a slight uptick in business travel since January 2021, which is expected to gradually increase as travel restrictions into the state are relaxed,” said Jaideep Dang, Managing Director, Hotels and Hospitality Group, South Asia, JLL.
India RevPar Declines
The India’s hospitality industry witnessed a decline of 54.9% in RevPAR during January to December (CY 2020), compared to CY 2019. With the revival of domestic travel, emergence of recovery indicators has come to the rescue of the sector. The recovery of the sector has been primarily driven by leisure ‘revenge travel’ during weekends, festival season, weddings and demand of food & beverage.
To help revive the sector, Maharashtra government recently issued a directive announcing an extension for operational timing for restaurants and shops and have allowed them to be operational till 1:00 am. The move was being welcomed by the city’s hotel and restaurant industry as a sign of going back to normalcy. Additionally, with rebate extended in various benefits including electricity charges and property taxes, the Maharashtra government has taken constructive steps to help increase the profitability of the industry.
Further, the government also reduced the number of permissions required to start a new hotel or a restaurant to 10 from 70. The Atmanirbhar Bharat 3.0 measures announced by the government included the launch of ECLGS 2.0-Guaranteed Credit for supporting the 26 stressed sectors identified by the Kamath Committee.
