Hospitality sector's per-room revenue grew 89.6% YoY in Q3: JLL report

Room demand across business cities remained strong during the quarter, primarily driven by MICE and other business-related travel

The Indian hospitality sector continued to post strong yearly growth in the third quarter of the 2022 calendar year, on the back of a sustained increase in corporate travel. During the same quarter last year, the industry was struggling to recover from the second wave of the pandemic.

Revenue per available room (RevPAR) grew by as much as 89.6 per cent YoY during the third quarter of this year, said a JLL report.

Hotel room demand across business cities remained strong during the quarter primarily driven by Meetings, Incentives, Conferences and Exhibitions (MICE) and other business-related travel. 

Despite long weekends, most business cities performed well with overall occupancy levels rising approx 70 per cent. The sector also witnessed strong growth in Average Daily Occupancy (ADR) levels, according to the report.

The JLL study also said that 54 hotels with 4,282 keys were signed in the third quarter of this calendar year. The hotel signings increased by a significant 63.2 per cent over the signings in Q3 of Calendar 2021.

However, international operators dominated signings over domestic operators with a 53:47 ratio in terms of inventory volume.

All six key markets posted strong YoY growth in RevPAR levels in the third quarter, due to the comparable low base of last year amid travel restrictions post the second wave of the pandemic.

According to the report, Bengaluru emerged as the RevPAR growth leader in Q3 2022, growing by 241.4 per cent over Q3 2021, followed by Hyderabad and Chennai with YoY growth of 140.9 per cent and 123.6 per cent, respectively.

“Demand growth remains strong in Q3 2022. Hotels across major business and leisure destinations are performing either at par or higher than pre-Covid RevPAR levels. This stellar recovery has renewed confidence in the sector, resulting in increased development and investment activity,” said Jaideep Dang, managing director, hotels and hospitality group, India, JLL. "We believe this momentum will continue through the year-end. Furthermore, we expect the hotel investment climate to remain buoyant in 2023 as hotel performances further strengthen.” 

The last quarter of the year is expected to remain busy on the back of weddings and domestic leisure, as the winter vacation sets in. Meanwhile, business travel will remain strong till the end of the year, the report said.