Tune firms up six hotels in India

FOLLOWING a joint venture signed last year with India’s Apodis Hospitality, budget brand Tune Hotels has firmed up six properties in South India, the first of which is expected to open by end-2011 or March 2012. The six locations – Bangalore, Calcutta, Hyderabad, Chennai, Cochin and Trivandrum – are all in the network of low-cost carrier AirAsia, whose head honcho, Tony Fernandes, owns Tune Hotels.

Apodis Hospitality's chief investment officer, Umesh Luthria, said the joint venture – a management company – was on track to have 20 Tune Hotels in three years. He said the properties kept to the model of Tune Hotels except for room sizes, which must conform to Indian regulations of a minimum of 13m² for a single room and 15m² for a double. Luthria brushed aside skeptics who did not believe Indian guests would pay for extras such as towels, air-conditioning and TV. He believed that his decision to partner Tune and not a global hotel player with a budget brand was the right one.

“We picked Tune Hotels because it is an Asian company and thus understands the Asian guest psyche better, because it came out of an airline company, which understands the concept of limited service better than hotels, and because it came from a budget carrier, whose customers understand that they will get what they pay for,” he said. He expected an ARR of US$30 for Tune Hotels in India. This is probably the lowest hotel rate travel agents can get in India. A new economy hotel brand, Peppermint, by India's Royal Orchid Hotels, expected a rate of US$80 for a 20-22m² room. According to chairman and managing director, Chender Baljee, that is lower than what he believed an Ibis in India fetches, US$100 in general.
-TTG Asia.
http://www.tunehotels.com/