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FHRAI to push for service apartment classification

Sees guesthouses and service apartments as alternative to overpriced hotels

Sanjeev Bhar - New Delhi

Manbeer Choudhary President FHRAI

Anticipating the boom in service apartments that are considered to be a cheaper alternative to over-priced hotel rooms, the Federation of Hotel & Restaurant Association of India (FHRAI) will work closely with the ministry of tourism to formulate a grading and classification system for service apartments as well as guesthouses.

This is the sole initiative of the FHRAI, steered by the association with its president Manbeer Choudhary at its helm. He feels that service apartment operators should voice their desire for classification considering the continuous growth this market has shown in the recent past, in terms of brand and otherwise. "However, since India is still an evolving market for long-stay facilities it will take some time to talk about the specifications of classification. Also, for classification there has to be substantial national presence, which is currently absent," Choudhary says.

He adds that this kind of grading becomes necessary amidst the sky-rocketing hotel accommodation rates, which directly affects long-staying and budget travellers. The association therefore wants to formulate a grading system if the star classification, that is applied for hotels the world over, doesn't work. Moreover, although guesthouses in the country have been regularised, nothing has progressed as far as service apartments are concerned.

"Since hotels in various cities these days are over-priced, they are affordable only to business travellers and the elite. Service apartments are a great alternate to hotels and to make them more popular we want some kind of classification and grading approved by an authority for quality assurance of service. We are therefore working closely with the Ministry of Tourism for the same and will take this issue up with them during our upcoming convention," Choudhary adds. Many officials from the Ministry including Amitabh Kant, joint secretary, MoT, are expected to attend the event.

Such a classification would not only set a benchmark for quality standards but also initiate a check on illegal facilities. A sample study for Bangalore conducted by global real estate advisory firm, DTZ Debenheam Tie Leung, on serviced apartments revealed that there is ample demand from business travellers looking for long stays in the city due to its easy availability and cost effectiveness. The occupancy rates of the serviced apartments in year 2005-06 have been approximately 74 per cent. Clientele occupancy from the domestic sector is significant with 63 per cent, while the remaining 37 per cent are foreign clients.