Moumita Bakshi Chatterjee
Bharat Kumar

New Delhi/Chennai , Dec. 25

LONG commuting time within the city, unavailability of hotel rooms and exorbitant room charges may soon be a thing of the past for foreign clients who come calling on IT companies in India, as infotech firms are beginning to see value in having their own hotel-type accommodation.

Infosys was the first to arrive on the scene, when it announced such plans in mid-2005. "India is running out of capacity in many areas - airports, roads and hotels. People like us depend on international business. Therefore, it is imperative that our business visitors travel easily and stay comfortably. We have set up an in-house 500-room complex in Bangalore for our customers as well as employees from outside," said Mr T.V. Mohandas Pai, Chief Financial Officer of Infosys Technologies.

With Infosys playing host to 70-100 visitors every day, the complex has been registering an over 90 per cent occupancy rate, he said. "Hotels are running full not only in Bangalore but in all major cities including Chennai and Hyderabad. There is a need to double the capacity in four-star and five-star hotels over the next two to three years, to cater to the increasing demand. Moreover, the hotel charges are exorbitant," said Mr Pai.

Mr Sunil Mehta, Vice-President of software association Nasscom, said, "Besides the fact that it is becoming increasingly difficult to find hotel rooms between October and March - when the client traffic is at its peak - the hotel charges in places like Bangalore is about $250-300 (Rs 11,283-13,540), the same as in New York," Mr Mehta said.

Hence, a small but growing number of IT companies are finding it viable to have their own serviced apartments, guest houses or on-campus accommodation, housing luxurious suites that are comparable to the most plush hotels in India. For instance, the suites in Infosys' complex are billed to have hi-tech facilities including wireless connectivity and high-end plasma TVs in the rooms.

What's more, the 500-room complex has resulted in a return on investment (RoI) of 18-22 per cent in terms of cost savings for Infosys.

Syntel, a smaller company, too saw sense in building its own accommodation.

In a conference call with analysts recently, the company gave an update on its 70-room hotel coming up at its campus in Pune. A member of the company's management team said, "We won't call it a hotel. It's a set of luxury apartments meant for business visitors. For a visitor staying for two to three days, it makes so much sense to avoid travelling between the hotel and the campus every day."

Mr Anuj Puri, Managing Director of Trammell Crow Meghraj, a real estate consultancy firm, sees hotels being included in IT park project blueprints in future.

"Lack of availability of hotels at short notices and dearth of budget hotels for visitors who sometimes come for a few hours are prompting companies to explore the option of having on-campus accommodation for clients," Mr Puri said.

For developers, constructing hotels and serviced apartments next to IT parks not only enhances the selling proposition of the project but also ends up being a profitable venture, given the huge captive demand from the companies within the IT park premises, he said.

For example, in its maiden IT park project coming up at Greater Noida, Ansal Properties and Infrastructure Ltd has allotted five acres for a hotel. "There is a strong demand from clients for this added facility within the proposed IT park. We also feel IT parks located in the suburbs should be self-sustaining units," said Mr Aditya Wadhera, GM (Marketing), Ansal Properties and Infrastructure.

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