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ABS Hotels, the Master Franchiser for Microtel in India,
Planning Up to 50 New Construction Hotels

By Girish Rao, The Economic Times, India
Knight Ridder/Tribune Business News

Mar. 12, 2005 - BANGALORE, India -- India is clearly a hotspot for hospitality business in Asia across the service spectrum ranging from economy to five-star. After recent announcements by European budget brand 'Accor' (Ibis) and homegrown 'Taj IndiOne', its Microtel, North America's lead budget hotel brand's turn to unveil its India strategy.

In the mid-term, it involves setting up 50 brand new hotels from scratch since it does not believe in acquiring existing properties. The external facade and the look and feel of the hotel will be similar to the ones in the US.

Microtel will roll out the first of its properties in Bangalore next year before entering metros like Delhi, Hyderabad, Chennai and Pune which receive significant number of international visitors who are familiar with the brand. In the next phase of growth, the chain will expand its footprint to other centres.

According to Mr Amrish Bhuvania, head of ABS Hotels, which has the master franchise for Microtel in the Indian sub-continent, a typical hotel will have 100 rooms, which may be expanded depending on demand. The investment will be in the region of Rs 10 crore-Rs 15 crore in each property.

Like in the US, Microtel in India will, among other conveniences, offer free local and domestic long distance calls plus internet connectivity to its guests.

The beds -- even in a single room -- will be large enough to accommodate a couple.

The room tariffs will be in the Rs 1,800-Rs 2500 bracket, which will be the primary source of revenue. Brands like Cafe Coffee Day or Barista will be invited to set up their outlets in the hotel for the benefit of guests.

The business model followed by the developers will enable the hotels to break even in three to four years. Incidentally, most of the 400-plus Microtel hotels across the world are in profit, reflecting the success of this model.

While there will be no room service, the tariff will include complimentary breakfast at the restaurant. Each floor in the hotel will have a dispenser with snacks and beverages for guests to buy.

A common laundromat will be provided in central areas where guests can drop of their clothes, a service which will be charged on the basis of weight.


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Copyright (c) 2005, The Economic Times, India

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