Newstrack

Tax holidays for hospitals to spur hospitality

Sanjeev Bhar - New Delhi

The tax holiday extended by the union budget for hospitals in the tier-II and III cities is poised to fuel a mutually beneficial hospital-hotel partnership, and augurs well for medical tourism in the country.

Land banks lying with hospital groups are now expected to be used for developing hotels on a partnership basis, where hospitals retain ownership of the land and the hotel companies oversee the management of the property.

At present, Fortis Hospital in Mohali owns and operates a 25-room mid-budget hotel, Fortis Inn, within the hospital complex, which not only caters to recuperating foreign and Indian patients but also to the relatives of patients admitted to the hospital.

Hotel groups, especially in the mid to low-budget segment, but not restricted to them, are scouting for suitable partners, given that a spate of hospitals are expected to come up as a result of the budget announcement. An expert from the industry suggested that this occurrence, however attractive, would be restricted to cities that are well connected through airlines.

Speaking to Express Hospitality, Ajay Bakaya, executive director of Sarovar Hotels & Resorts, revealed, "We are considering opportunities with hospitals as this sector offers good opportunity. In fact, we are at the final stage of closing a deal for developing a premium Sarovar Hotel brand with a hospital group."

Dr K M Kapoor, head - department of plastic & cosmetic surgery, Fortis Hospital Mohali says, "Fortis Inn, which is 50 yards away from the hospital, enables us to take special care of recuperating patients. Attendants monitor patients' progress post-surgery, which is otherwise not possible at distant hotels. The room rates range from Rs 1800 to 2500 and Rs 4000 for family suites. The hotel is also equipped with an in-house restaurant."

Existing and upcoming hotels in tier II and III cities will benefit too as hospitals sprout up in their vicinity. "A certain hotel near our hospital enjoys high occupancies as many people prefer to stay there as well," Kapoor explained.

Real estate majors too are expected to enter the fray, especially those players with land banks in tier-II & III cities, who are investing in developing hospitals. Bakaya concurs and says, "It is possible that a real estate player would like to combine the synergies by engaging experts for managing the hospital and hotel respectively."