Market Insight - Moneycontrol

Market InsightChennai, India

April 2012

Hotel Intelligence Report

2 Hotel Intelligence • Chennai, India • April 2012

ContributorsVibhor KalraResearch Analyst, [email protected]

Vibhor Kalra is a part of the advisory team at Jones Lang LaSalle Hotels, India. Apart from publishing research articles and industry white papers, he is also responsible for conducting market research and maintaining databases. Prior to joining Jones Lang LaSalle Hotels, Vibhor has worked with the business development team of a leading financial services firm in India.

Sudeep JainExecutive Vice President, [email protected]

Sudeep Jain is responsible for managing the Indian business of Jones Lang LaSalle Hotels, the region’s market leader in hotel investment and advisory services. Leading the Firm’s dedicated Hotels team in India, he also oversees the Firm’s advisory and transaction services.

Sudeep joined Jones Lang LaSalle Hotels in April 2008 with over six years of experience in the hospitality sector and a career spanning the US and Asia Pacific. Prior to joining the Firm, Sudeep was based in New York with Starwood Hotels & Resorts Worldwide, where he was involved in corporate strategy, asset management, real estate development strategy and marketing and business development. Before that, he was a manager at Bain & Company, Inc. and an investment banker with Merrill Lynch in Singapore.

Sudeep has a Bachelor of Arts degree in Computer Science, Mathematics and Economics from Dartmouth College, USA and a Master’s degree in Business Administration from Harvard Business School. In addition, he has a certification in Real Estate, Development and Hotel Investment from Cornell University’s School of Hotel Administration.

About Jones Lang LaSalle Hotels

Jones Lang LaSalle Hotels is a global real estate services firm focused exclusively on hotels & hospitality. We provide acquisition and financing advice, valuations, investment sales and asset management for luxury hotels, select service and budget hotels, smaller hotels and pubs, from single assets to large portfolios and mixed-use developments.

In the last five years we completed nearly 4,000 advisory and valuation assignments and more sale, purchase and financing transactions than any other hotels real estate firm in the world… worth over $30 billion. With 43 offices in 20 countries and 265 hotels real estate experts, no other firm is better connected. Through our depth and breadth of research and experience, with 75 Research Reports each year, we know the market at every level, we know the players and we know how to get results.

About Jones Lang LaSalle Hotels, India

Jones Lang LaSalle Hotels, India has extensive experience throughout the subcontinent in providing transaction and advisory services to its clients, which include prominent hotel developers, operators, investors and lenders. Members of the team have extensive experience in hospitality consulting and valuation techniques. Our team members come from diverse backgrounds and possess education in hotel management and finance from premier institutions in India and abroad. Such credentials, combined with an extensive experience in domestic and international hospitality consulting, make us a very dynamic team that is well suited to handle important assignments. Services include investment sales, mergers and acquisitions, capital raising, valuation and appraisal, asset management, strategic planning, operator selection, management contract negotiation, consulting, industry research and project development services.

Jones Lang LaSalle Hotels, India was awarded the ‘IPC Hospitality Team of the Year’ by the Property Awards held in December 2010.

Hotel Intelligence • Chennai, India • April 2012 3

Emergence of India’s Detroit

Chennai (formerly known as Madras), the capital city of Tamil Nadu, has a broad industrial base in the automobile, computer, technology, hardware manufacturing and healthcare sectors. A large number of automobile companies such as Hyundai, Nissan, Ford and Ashok Leyland have set up their base in Chennai due to availability of skilled labour, consistent industrial policy, access to a world-class port and financial incentives offered by the government. According to Confederation of Indian Industry (CII), Chennai accounted for 60% of India’s automotive exports in 2006-07. The success of automobile sector conferred Chennai the status of ‘India’s Detroit’.

Chennai

Administrative Status Capital of Tamil Nadu

Area Chennai Metropolitan Area: 1,189 sq km

• Chennai District: 176 sq km• Thiruvallur District: 637 sq km• Kancheepuram District: 376 sq

km

Population (in millions) 4.7 (2011 census)

Ruling State Government AIADMK-led alliance headed by Chief Minister J. Jayalalithaa

City Economy • Automotive capital of the country• Economic growth further fuelled

by IT-ITeS and manufacturing

City Advantages • Availability of world-class skilled manpower

• Location advantage - good connectivity and linkages

• Presence of major IT and manufacturing companies

• Excellent social, education and health facilities

• Availability of commercial Grade A office space

Fast Facts

Source: Chennai Metropolitan Development Authority

Chennai is also home to industries such as financial services, IT/ITeS (Information Technology/Information Technology-enabled services) and shipping, among others. It is the second-largest exporter of software, next to Bangalore. India’s top IT companies like TCS, Infosys and Wipro have large operations in the city.

Such a development profile has also proven beneficial to Chennai’s lodging industry, which has consequently witnessed substantial growth over the past few years.


Global and Domestic Connectivity

Air

Chennai International Airport is the third-busiest airport in India after Mumbai and Delhi. It includes both an international and domestic terminal from which 22 international and eight domestic airlines operate. It is located about 15 km from Chennai CBD (Central Business District).

Strong growth in passenger and aircraft movements at the airport in recent years has resulted in a second airport being planned in Sriperumbudur, which is almost 40 km from Chennai city centre.

Rail

Chennai is the headquarters of Southern Railways network with two major railway stations located in the city, namely Chennai Central Railway Station and Chennai Egmore Railway Station. While the former connects Chennai to other metropolitan cities and state capitals of India, the latter connects Chennai with other cities in Tamil Nadu and Kerala. Several superfast trains such as Chennai-Bangalore Shatabdi, Grand Trunk Express, Rajdhani Express and Jaipur Express connect Chennai to major cities in India.

Road

Chennai has a total road length of 2,847 km1 including a ring road, arterial roads and highways. Four national highways namely NH-4,

NH-5, NH-45 and NH-205 radiate outward from Chennai to provide excellent road connectivity with other important cities in India.

• NH-4: A 1,235 km-long national highway that connects Chennai to Mumbai via Bangalore and Pune.

• NH-5: Runs along India’s east coast from Chennai to Jharpokharia in Orissa, to connect with NH-6 to Kolkata.

• NH-45: Also known as the Grand Southern Trunk Road, this highway is one of the busiest in South India and runs from Chennai to Theni in Tamil Nadu en route to Trichy (an important industrial hub in Tamil Nadu).

• NH-205: Connects Chennai to Anantpur in Andhra Pradesh en route to Tirupathi and Tiruvallur.

Sea

Chennai is serviced by two major ports, namely Chennai Port and Ennore Port.

• Chennai Port is one of the largest ports handling 2,1812 vessels in 2010-11. This port handles mainly automobile and general industrial cargo.

• Ennore Port was set up to meet the coal requirements of the Tamil Nadu Electricity Board. This port handled 11.01 million tonnes3 of cargo in 2010-11, 85% of which was coal.

1Source: Corporation of Chennai 2Source: Port of Chennai website (http://www.chennaiport.gov.in) 3Source: Ennore Port website (http://www.ennoreport.gov.in)


Bu

ckin

gh

am

Can

al

Velachery

Perungudi

Thiruvanmiyur

IndiraNagar

KasturbaNagar

Mandaveli

Thriumayilai

Light House

Tiruvallikkeni

Chepauk

GreenwaysRoad

ChennaiBeach

Fort

ParkTown

Park Town

KotturPuram

Washermanpet

Mannady

ChennaiFort

Vepery

ShastriNagarKilpauk Medical

College

Aminjikarai

ShenoyNagar

AnnaNagarEast

Anna NagarTower

Tirumangalam

Koyambedu

CMBT

Vadapalani

AshokNagar

KK Nagar

SIDCO

Alandur

St. ThomasMount

Minambakkam

ChennaiAirport

AirlinesColony

Officer’s TrainingAcademy

Guindy

Little Mount

Saidapet (UG)

Teynampet (UG)

Gemini (UG)

ThousandLights (UG)

LIC (UG)

Egmore (UG)

Taramani

Puzhuthivakkam

Arumbakkam

Mundakanniamman Koil

Tirusulam

Guindy

Minambakkam

Pazhavanthangal

St. ThomasMount

Nungambakkam

Chetpet ChennaiEgmore

Saidapet

Kodambakkam

Mambalam

Villivakkam

Korattur

Pattaravakkam

PeramburLoco Perambur

Carriage

Perambur

VyasarpadiJeeva

Royapuram

ChennaiBeach

ChennaiFort

ChennaiCentral

ChennaiPark

BasinBridge

Pallavaram

Chromepet

Ambattur

Thirumullaivoyal

Tambaram

31

Apollo

Shiva Temple

Vels Collegeof Science

IndianInstitute of

Technology

RajBhawan

CosmopolitanClub Golf Links

AmericanInternational

School WorldBank

MGRFilm City

Chennai Airport

Domestic

International

RaceCourse

GuindyNational

Park

Chennai SnakePark

Malar

AnnaMGR

ChidambaramStadium

Inter State Bus Terminal

Vijaya

AVMRajeswari

Udayam

Kaliappa

AnnaFlyover

CholaSheraton

Royapettah

FortSt. George

VictoryWar

Memorial

Ega

Sangam

Gaiety

Satyam

TajCoromandel

Palmgrove

Airway

Trident

Radisson

Le RoyalMeridienChennai

Empee Hilton

ITC Grand Chola

Hyatt

Lemon Tree

Shangrila

SRM Hotel

Sindoori

Connemara

ThePark

ParkShreaton

JW Marriot

The Leela

AscottSomersett

SankaraNetralaya

CancerInstitute

MeenakshiDental

DurgabaiDeshmukh

ChennaiPort

Crown

ESI

Institute ofMentalHealth

Abirami

Railway

MadrasMedicalMission

SundaramMedicalFoundation

Nathamuni

Peripheral

Jawahar LalNehru

Stadium

Shri GuruRaghavendraTemple

Madras Instituteof Technology

B A Y

O F

B E N G A L

Kuvam

River

Adya

r R

iver

KuvamRiver

Kuvam

River

AdyarRiver

Kuvam River

Kuvam River

Adyar River

Kuvam River

Adyar River

Ad

am

bakkam

Eri

Bu

ckin

gh

am

Can

al

Velachery Eri

MadippakkamEri

MuvarasanpattuEri

KoratturTank

ChitlapakkamLake

AmbatturLake

HA

TT

EP

AY

OR

BAZAR

ROAD

SALAI

MA

ND

AP

AM

RO

AD

GA

ND

HI R

OAD

DU

RG

AB

AI

DE

SH

MU

KH

SA

NT

HO

ME

BE

AC

H R

OA

D

GREENWAYS ROAD

AP

PU

ST

RE

ET

BA

ZA

R R

OA

D

ROAD

HIG

H R

OA

D

CANAL BANK ROADSOUTH

KA

MR

AJ S

ALA

I

ROADCHAMIERS

MANDAVELI

KULATHUR ROAD

CORPORATION ROAD

MAINSTREET

PIL

LAYA

R

KOIL

MG

R M

AIN

RO

AD

CA

NA

L P

UR

AM

RO

AD

AN

NA

SA

LA

I

PE

RIY

AR

SA

LA

I

3RD

AVE

NU

E

BESANT AVENUE

AVENUE

7TH AVENUE

1ST AVENUE

2N

DAV

EN

UE

6T

HA

VE

NU

E

BR

IDG

E R

OA

D

2NDAVENUE

LA

TT

ICE

WEST AVENUE

MAHATMA GANDHI ROAD

4TH CROSS ROAD

KA

NA

GA

M

BO

NN

DE

LH

IA

VE

NU

ER

OA

D

AV

EN

UE

2N

D M

AIN

RO

AD

S

MKN

RO

AD

CO

UR

SE

RO

AD

RA

CE

LIN

K R

OA

D

STA

TIO

NR

OA

D

ALA

ND

UR

RO

AD

MKN ROAD

DURAI

ROAD

1S

TM

AIN

RO

AD

DR

AM

BE

DK

AR

RO

AD

SWAMY

GOVINDAN

BO

AG

NEW

RO

AD

BURKIT ROAD

HABIBIULLAH ROAD

CP

RA

MA

SW

AM

Y R

OA

D

RANGA ROAD

BHARATHIDASAN ROAD

VE

NK

ATAN

AR

AYAN

A R

OA

D

ROAD

BO

AG

RO

AD

NO

RT

H

TH

IRU

MA

LA

IP

ILLA

IR

OA

D

CE

NO

TA

PH

RO

AD

NA

TE

SA

N R

OA

D

SALAIMAGUMNAHSIAVVA

BESANT ROAD

PETERS ROAD

LUZ CHURCH DAOR

LLOYDS ROAD

KA

ST

UR

IRA

NG

A R

OA

D

PETERS ROAD

ROAD

DR

NAIR

ROAD

GAN

DHI I

RW

IN

TR

IPLIC

AT

EARUNACHALA STREET

WHITES ROAD

PYCOFTS ROAD

WALAJA ROAD

HIG

H R

OA

D

ROAD

FLA

GS

TAFF

DR ALAGAPPA ROAD

ETHIRAJ ROAD MA

RS

HA

LLS

RO

AD

ADITHANAR

GR

EE

MS

RO

AD

PANTHEON R

OAD

ROAD

S

VR

COLLEGE ROAD

STERLING ROAD

HA

DD

OW

RO

AD

ROAD

CH

OO

LA

IME

DU

HIG

H R

OA

D

TANK BUND

RAMANATHAN ROAD

BRINDAVAN STREET

10TH AVENUE

ANNA MAIN ROAD

RAJAN SALAI

RAJAMANNAR SALAI

4TH

AVEN

UE

PU

LLA

AV

EN

UE

NELSON M

ANICKAM RO

AD

NE

HR

U

AN

NA

AR

CH

RO

AD

PAD

I KU

PPA

M

RO

AD

KA

LIM

MA

N K

OIL

STR

EE

T

4TH AVENUE

VA

NA

GA

RA

MA

MB

AT

TU

RR

OA

D

3R

D M

AIN

RO

AD

COLLEGE ROAD

RA

JA S

TR

EE

T

ALA

PP

AK

KA

M M

AIN

RO

AD

ANNA SALAI

AM

BE

DK

AR

RO

AD

BHARATHI SALAI

PERUMAL KOIL STREET

KAMARAJAR SALAI

LA

KE

VIE

W R

OA

D

GURUKKAMBAKKAMMAIN ROAD

VEMBADI VINAYAKAR KOIL STREET

VE

LA

CH

ER

I B

YP

AS

S R

OA

D

KA

RU

NE

EK

AR

ST

RE

ET

VANDIKKARAN STREET

LAKE VIEW ROAD

1ST

MAIN

RO

AD

BA

LA

JI N

AG

AR

MA

IN R

OA

D

SABARI SALAI

PO

NN

IAM

MA

N K

OIL

ST

RE

ET

PILLAIYAR KOIL STREET

2N

D M

AIN

RO

AD

6TH MAIN ROAD

1ST MAIN ROAD

DA

OR

INA

MM

AK

KA

VA

DE

MA

NN

A R

OA

D

NE

HR

U M

AIN

RO

AD

MUVARASANPATTUI MAIN ROAD

DARGAH ROAD

3RD

MA

IN R

OA

D

MU

VA

RA

SA

NP

AT

TU

I

BIG STREET

ME

DA

VA

KK

AM

MA

IN R

OA

D

JAW

AH

AR

LA

LR

OA

D

POONAMALLE HIGH ROAD

(INNER R

ING R

OAD)

HIGH ROAD

POONAMALLE

KODAMBAKKAM

GN

CHETTYROAD

ANNA

SALAI

CATH

ED

RAL

NO

RT

H U

SM

AN

RO

AD

PERIYAR EVR

RADHA KRISHNAN

PYCROFTS ROAD

KA

MA

RA

JAR

SA

LA

I

SA

LA

I

SALAI

ROAD

ANNA SALAI (

MO

UNT RO

AD)

RO

AD

MA

HA

TM

A G

AN

DH

I

HIGH

HIG

H R

OA

D

SA

LA

I

RA

JAJI

ROAD

SO

UT

H U

SM

AN

RO

AD

ELDAMS ROAD

SANTHOM

E

RK

MU

TT

RO

AD

ANNA S

ALAI

(MOUNT ROAD)

THYAGARAYA ROAD

TTK

SA

LAI

ROAD

(IN

NE

R R

ING

R

OA

D)

AN

NA

SA

LA

I

CHAMIERS ST MARY’S

JAW

AR

HA

RLA

LN

EH

RU

RO

AD

GREATSOUTHERN

TRUNK ROAD

MOUNT POONAMALLEE ROAD

VELA

CH

ER

IR

OA

D

ANNA SALAI

MOUNT

BUTT ROAD

ROAD

CA

NA

L B

AN

K R

OA

D (W

ES

T)

SARDAR PATEL ROAD

DR

MU

TH

ULA

KS

HM

I R

OA

D

TARAMANI ROAD

VE

LA

CH

ER

I R

OA

D

OLD

MA

HA

BA

LIP

UR

AM

EA

ST

CO

AS

T R

OA

D

VE

LA

CH

ER

Y M

AIN

RO

AD

EA

ST

CO

AS

T R

OA

D

GANDHI

CSIR ROADROAD

NH

- 45

RO

AD

5TH

SA

LA

IT

HIR

UV

IKA

S

ARCOT ROAD

NSK SALAI

ARCOT ROAD

DAIRY ROAD

TE

LE

PH

ON

E E

XC

HA

NG

E R

OA

D

MAIN ROAD

VINAYAKAR KOIL STREETMANIKKA

EA

ST

AV

EN

UE

SOUTH AVENUE

CHENNAI TIRUVALLUR HIGH ROAD

RE

D H

ILLS

RO

AD

PAPER MILLS ROAD

KONNUR HIGH ROAD

RO

AD

MELPATTI PONNAPPA STREET

ROAD

HIG

H

AN

CH

ER

I

ER

UK

K

MA

NN

AR

SA

MY

KO

IL S

TR

EE

T

RA

JAR

AT

HIN

AM

R

OA

D

CEMENTRY ROAD

VO

C R

OA

D (W

ALL

TA

X R

OA

D)

PR

AK

AS

AM

RO

AD

MIN

T S

TR

EE

T

OLD JAIL ROAD

NETAJI SUBASH CHANDRA BOSE ROAD

TH

AM

BU

ST

RE

ET

BRID

GE R

OADELEPHANT

GATE

MIN

T S

TR

EE

T

ST XAVIER STREET

PURASAVAKKAM HIGH R

OAD

G H ROAD

DEMELLOWS ROAD

PE

RA

MB

UR

BA

RR

AC

KS

RO

AD

STRAHANS ROAD

RO

AD

BRIDGE

BA

SIN

POWDERMIL

LS

RO

AD

YAPPA STREET

SANTHI

PULIANTHOPE HIGH ROAD

BR

ICK

KLIN

RO

AD

KONNUR HIGH ROAD

KK

AM

TA

NK

RO

AD

ANDERSON

ME

DAVA

RO

AD

PERAMBUR HIGH ROAD

KILPAUK GARDEN ROAD

6TH AVENUE

3R

DA

VE

NU

E

2ND AVENUE

1S

TA

VE

NU

E

NEW AVADI ROAD

TIRUVALLUR HIGH ROAD

CHENNAI

CONSTABLE ROAD

AMBATTUR EST ROAD

PA

RK

RO

AD

2N

D M

AIN

RO

AD

SOUTHERN AVENUE

3R

D M

AIN

RO

AD

1ST CROSS ROAD

1S

T M

AIN

S R

OA

D

TH

RU

VA

LLU

VA

R R

OA

D JAW

AH

AR

LA

LN

EH

RU

RO

AD

PERAMBUR MAIN ROAD

NE

WA

VA

DI R

OA

D

CH

EN

NA

I B

YP

AS

S R

OA

D

CHENNAI BYPASS R

OAD

KUNRATHUR ROAD

PAMMAL MAIN ROAD

PO

LLC

HA

LU

R M

AIN

RO

AD

AN

NA

ST

RE

ET

AN

NA

ST

RE

ET

NEHRU STREET

NH - 4

OLD MAHABALIPURAM ROAD CONNECTING


DARGAH ROAD

NH - 4

ThyagarayaNagar

eropalyM

SA

NT

HO

ME

BE

AC

H

ELLIO

TS

BE

AC

H

AnnaUniversity

KotturPuram

TheosophicalSociety

Kapaleeswarar

Mandaveli

BesantNagar

TelephoneNagar

IndiraNagar

OkkiyamThuraipakkam

RajaNagar

KathiparaJunction

MA

RIN

A B

EA

CH

kuapehC

K KNagar

KilAyanamba

Sri lyappaNagar

marupamaR

LakshmiNagar

Kanchipuram

ijalaBragaN

PanchapandavaMalai

Tirusulam

SanthanammalNagar

Chromepet

RadhaNagar Keelkattalai

ThiruttaniNagar

Nemilicherry

Jain Nagar

ArunodhayamNagar

VijayaNagar

Perungudi

KasturbaNagar

ValmikiNagar

Dhandeeswaram

IndiraNagar

CITCampus

Puludivakkam

KodandaramaNagar

VSIEstate

RukmaniNagar

CLRI

Adambakkam

UllagaramNanganallur

Parangi Malai

Manappakkam

GuindyIndustrialEstate

Alappakkam

Vanagaram

Rajankuppam

Koyambedu

AlwarThirunagar

Virugambakkam

EkkaduThangal

Arumbakkam

Trustpuram

ShenoyNagar

Tiru VikaPark

ThousandLights

Pudupet

Chintadripet

Gopalapuram

SIDCOIndustrialEstate

RajaAnnamalaiPuram

Pelican Paradise

PanagalPark

Chetpet

AshokNagar

Teynampet

CHENNAI

KANCHIPURAM

CH

EN

NA

I

KA

NC

HIP

UR

AM

CH

EN

NA

ITIR

UVA

LLUR

Choolaimedu

RamappaNagar

Pallavaram

Aminjikarai

Kannan Nagar

Velachery

Taramani

Palavakkam

Thiruvanmiyur

GuindyAdyar

ArudraIndustries

Mugalivakkam

Nandambakkam

TIRUVALLUR

KANCHIPURAM

Porur

Nolambur

GoldenGeorgeNagar

Vadapalani

Jaffarkhanpet

Nungambakkam

Kilpauk

Egmore

Royapettah

Saidapet

Alwarpet

Pallikaranai

Vettuvankeni

Palavakkam

Perungudi

Puzhuthivakkam

Old Pallavaram

Neela

ngara

i Beach

SrinivasaNagar

Velachery

Kodambakkam

Mambalam

Nandanam

Nerkundram

Kathibada

Sowcarpet

George Town

Mannady

Pulianthope

Muthialpet

Old Washermanpet

Washermanpet

Siruvallur Vyasarpadi

Otteri

Vepery

EkangPuram

Purasavakkam

Kondithope

AnnaNagarEast

Dunlop

Ambattur

Mannurpet

JayalalithaNagar

TVSIndustries

SidcoIndustrialEstate

PeriyarNagar

AmbatturIndustrialEstate

Padi

AnnaNagarWest Extn

BalajiNagar

Agaram

Attipattu

Chennai

Anna Nagar

Ayanvaram

Perambur Korukkupet

Ambattur

Kil Ayanambakkam

Maduralvoyal

Ayappanthangal

Pallavaram

Chitlapakkam

SriperumbudurPallavaram

Tambaram

Bethel Nagar

MGRNagar

Nilangarai

Existing Route

Corridor 1 Stations

Corridor 2 Stations

Existing Route Stations

CHENNAI MRTS ROUTE PLAN

Corridor 1

Corridor 2

W

S

SW

N

NW

SE

NE

E

COPYRIGHT © JONES LANG LASALLE 2010. All rights reserved.

Designed and published by Jones Lang LaSalleMAP NOT TO SCALE

Nandanam

CHENNAI

Micro Markets in Chennai

Central Business District (CBD): Being a state capital, Chennai CBD houses various government departments, head offices of major companies, high-end residential as well as retail space. This micro market also features a large number of branded hotels primarily in the upper upscale and luxury segments. The CBD comprises areas such as Egmore, Mount Road and MRC Nagar.

Secondary Business District (SBD): SBD comprises areas along Inner Ring Road, Velachery Road, Anna Nagar and Guindy, to name a few. This micro market features offices of primarily BFSI (Banking,

Financial Services and Insurance) companies. Because of this and its close proximity to the airport, a number of hotels including Hilton, Trident and Radisson have come up in the micro market.

Peripheral Business District (PBD): This micro market comprises of GST Road, Old Mahabalipuram Road (OMR) and Sriperumbudur. OMR features large built-to-suit campuses of primarily IT/ITeS companies, often referred to as the IT corridor of Chennai, whilst Sriperumbudur is an industrial/manufacturing hub that houses manufacturing facilities of companies like Nokia, Hyundai, Caparo and Saint-Gobain.


Lodging Demand Drivers

Source: Jones Lang LaSalle REIS, India

Chart 2: Commercial Supply Distribution across Micro Markets (4Q 2011)

Source: Jones Lang LaSalle REIS, India

Chart 1: Grade A commercial Stock and Vacancy in Chennai

6.0

5.0

4.0

3.0

2.0

1.0

0

35.0%30.0%25.0%20.0%15.0%10.0%

0.0%5.0%

2008 2013E2012E201120102009

Stock Vacancy

Stock Vacancy

2,500,000 35.0%30.0%25.0%20.0%15.0%10.0%

0.0%5.0%

CBD SBD PBD

2,000,000

1,500,000

1,000,000

500,000

Comm

ercia

l Stoc

k (sq

. mete

rs)

vaca

ncy (

%)

Comm

ercia

l Stoc

k (in

milli

on sq

. mete

rs)

vaca

ncy (

%)

Chennai has witnessed strong growth in Grade A office stock over the past four years, increasing by around 50%. The city has a total stock of 4.3 million square meters as of 4Q 2011 that resulted in a Compounded Annual Growth Rate (CAGR) of 16.1% over four years. Chart 1 presents the historical and future estimated Grade A commercial stock and vacancy.

SIPCOT (State Industries Promotion Corporation of Tamil Nadu Ltd) has successfully promoted Chennai as an industrial destination by setting up industrial parks at different locations within and around the city. SIPCOT has established industrial parks in Sriperumbudur, Oragadam, Siruseri, Gummidipoondi and Irungattukottai with a total allottable area of 7,988.6 acres.

Being a centre for trade, business, education and culture in southern India, coupled with easy connectivity to other key leisure destinations, Chennai has a fairly well-established hotel market. According to Jones Lang LaSalle Hotels’ research, lodging demand in Chennai is dominated by the business segment contributing 70-75% of the total demand, followed by (MICE) Meetings, Incentives, Conferences and Exhibitions (10-15%) and leisure (5-10%) demand sources.

Business Segment

Chennai is home to various industries such as manufacturing, automobile, auto-ancillaries, IT/ITeS and shipping, thus underpinning strong business demand.


S. No. Company Sector Location

1 Hyundai Automobile Sriperumbudur

2 Nissan Automobile Sriperumbudur

3 Asian Paints Paints Vanagram

4 Infosys IT/ITeS OMR

5 Tata Consultancy Services IT/ITeS OMR

6 Wipro IT/ITeS Guindy

7 Accenture Consulting GST Road

8 Nokia Telecommunication Sriperumbudur

9 Siemens Telecommunication Nungambakkam

10 Ashok Leyland Automobile Guindy

11 Saint Gobain Glass Sriperumbudur

12 Motherson Sumi Auto-ancillary Sriperumbudur

13 Apollo Tyres Auto-ancillary Sriperumbudur

14 Komatsu Heavy machinery Sriperumbudur

15 Cognizant IT/ ITeS OMR

Commercial Supply Distribution across Micro Markets

In terms of micro markets, PBD has the largest stock of Grade A office space in Chennai with a total supply of almost 2.2 million sq m. The availability of bigger land parcels especially on OMR that houses a large number of prominent IT companies has contributed to this. SBD follows with a total supply of 1.8 million sq m, while the CBD has a total stock of 0.3 million sq m only. However, vacancy levels in PBD are also highest at 32% compared to 16% and 21% in CBD and SBD respectively.

MICE

MICE demand in Chennai emanates in the form of meetings and conferences held by local companies. Training workshops, dealer conferences and exhibitions for product launches are the major contributors to the MICE segment in city centre hotels, whereas company off-sites contribute significantly toward MICE demand for hotels/resorts on the East Coast Road (ECR) stretch from Chennai to Mahabalipuram.

Source: Jones Lang LaSalle Hotels Research, India

Leisure Segment

Besides being an established business destination, Chennai is also a tourist’s paradise due to the presence of various tourist attractions within and around the city. Its proximity to destinations like Mahabalipuram and Puducherry add impetus to the growth of leisure demand sources.

Having an international airport, Chennai acts as a gateway to the state of Tamil Nadu with many significant religious temples located in cities like Tirupati, Kanchipuram and Tanjore.

Chennai is an integral part of various South Indian tourism circuits, the most famous of which is called the Golden Triangle of Tamil Nadu. It includes a tour of Chennai, Mahabalipuram and Puducherry through the ECR (also known as Chennai’s Entertainment Corridor). Whilst Mahabalipuram, with its vernacular temple architecture, is a religious destination, Puducherry has emerged over the years as a tranquil beach destination and is regarded as one of the best on the eastern coast of India. Both of these cities are popular with the local residents of Chennai as a weekend getaway.

List of Major Companies in Chennai


Entertainment Corridor of Chennai

Medical Tourism

Chennai is emerging as one of the biggest medical hubs in South-East Asia. The city offers world-class treatments in the fields of cardiology, oncology, eye care, nephrology and orthopedics. Apollo

Hospitals, started in Chennai and was one of the first corporate hospitals in India to provide medical treatments to foreign tourists. Other prominent hospitals in Chennai are Madras Medical Mission Hospital, MIOT Hospital and Fortis Malar Hospital.

Vivanta by Taj Fisherman’s Cove

Radisson Blu Resort Temple Bay


Tourism Market Profile

Being an economic and cultural centre in South India, Chennai has witnessed double-digit growth in international and domestic visitation over the past eight years, from financial year (FY) 2003-04 through 2010-11.

• International passenger traffic has increased from 2 million during 2003-04 to almost 4.2 million in 2010-11, which translates to an absolute growth of more than 100%.

• Domestic passenger traffic has increased from 2.5 million in 2003-04 to 7.8 million in 2010-11, recording a CAGR of 17.6%.

*YTD - April through November Source: Airports Authority of India, Jones Lang LaSalle Hotels Research, India

Chart 3: International Passenger Traffic at Chennai International Airport

4,500,000

2003-04 YTD 20122009-102008-092007-082006-072005-062004-05

CAGR 10.9% Growth 0.7%

Pass

enge

r Tra

ffic

4,000,0003,500,0003,000,0002,500,0002,000,0001,500,0001,000,000

500,000

2010-11 YTD 2011

Chart 4: Domestic passenger traffic at Chennai International Airport

*YTD - April through November Source: Airports Authority of India, Jones Lang LaSalle Hotels Research, India

2003-04 YTD 20122009-102007-082006-072005-062004-05

CAGR 17.6%Growth 13.2%

Pass

enge

r Tra

ffic

9,000,000

8,000,000

7,000,000

6,000,000

5,000,000

4,000,000

3,000,000

2,000,000

1,000,000

2008-09 2010-11 YTD 2011*


List of Existing Hotels in Chennai


Chennai Accommodation Market

Serial No. Hotel Location Category Keys1. Taj Coromandel Mahatma Gandhi Road Luxury 2022. Hyatt Regency Anna Salai Upper upscale 3273. Sheraton Park Hotel & Towers T.T.K. Road Upper upscale 2834. Le Meridien GST Road Upper upscale 2405. Hilton Guindy Upper upscale 2006. Trident GST Road Upper upscale 1677. Radisson Blu City Centre Egmore Upper upscale 1608. Vivanta by Taj Connemara Binny Road Upper upscale 1509. Vivanta by Taj Fisherman’s Cove Covelong Beach Upper upscale 13010 Radisson Blu Resort Temple Bay Mamallapuram, ECR Upper upscale 14411. Radisson Blu GST Road Upper upscale 10112. My Fortune Cathedral Road Upper upscale 9013. Raintree Anna Salai Upscale 23014. Taj Club House Club House Road Upscale 22015. The Park Anna Salai Upscale 21416. The Residency Towers T Nagar Upscale 17417. GRT Grand T Nagar Upscale 13318. Asiana OMR Upscale 11419. The Residency T Nagar Upscale 11220. Raintree St. Mary’s Road Upscale 10521. Courtyard by Marriott Anna Salai Midscale 23822. Fortune Hotel Select Palms OMR Midscale 12923. Aloft OMR Midscale 12924. The Pride Hotel Evr Periyar Salai Midscale 11525. Lemon Tree Hotel Sardar Patel Road Midscale 10826. Ginger IITM Research Park, OMR Budget 8527. Comfort Inn Marina Towers Pooniamman Koil Street Budget 8428. Quality Inn Sabari OMR Budget 8429. Somerset Greenways MRC Nagar Serviced apartments 188

Total 4,656

Existing Supply

Based on our research, Chennai has 29 branded hotels with 4,656 rooms spread across different categories. Some of the existing key players operating in the city include ITC, Starwood, Hyatt, Hilton, Marriott, Oberoi, Taj and Carlson. Prominent operators that are coming up with new properties include Leela, IHG and Accor, as shown in tables below.


Future Supply

Chart 5: Room Invetory Categorisation


Serivced Apartments 4%

Luxury 35%

Midscale 25%

Upscale 3%

Upper Upscale 18%

Serial No. Name of Hotel Location Category Keys Status Projected Opening1. ITC Grand Chola Mount Road Luxury 600 2012 Under construction2. JW Marriott MRC Nagar Luxury 357 - Construction on hold3. The Leela Palace MRC Nagar Luxury 329 2012 Under construction4. Park Hyatt Velachery Luxury 200 2012 Under construction5. Anantara East Coast Road Luxury 126 - Construction on hold6. Westin Velachery Road Upper upscale 215 2012 Under construction7. Le Meridien East Coast Road Upper upscale 97 2014 Under construction8. Ramada Vandalur Upscale 100 2012 Under construction9. Trader’s Hotel OMR Midscale 302 2014 Under construction10. Gateway Sholinganallur, OMR Midscale 190 2013 Under construction11. Novotel Sholinganallur, OMR Midscale 150 2013 Under construction12. Park Plaza Mylapore Midscale 140 2012 Under construction13. Royal Orchid Radhakrishnan Salai Midscale 126 2012 Under construction14. Ibis Sholinganallur, OMR Economy 200 2013 Under construction15. Ibis Mount Road Economy 160 2014 Under construction16. Sarovar Hometel Sriperumbudur Economy 170 2013 Under construction17. Fraser Residence OMR Serviced apartments 158 2013 Under construction

Total 3,620

According to Jones Lang LaSalle Hotels’ research, there are 17 hotels currently under construction in the branded segment in Chennai with a total inventory of 3,620 rooms. However, this number excludes an inventory of almost 2,500 rooms that are currently in various stages of planning and expected to hit the market within the next five to seven years. It should be noted that the bulk of the upcoming supply is being developed along OMR albeit with a number of projects planned in Sriperumbudur and thus can be refered as the future growth corridors for Chennai’s lodging market.

The majority of the upcoming supply in Chennai will be in the luxury segment (35%), with fewer rooms planned in the midscale (25%), upper upscale (18%) and economy segments (15%). Serviced apartments and upscale segments contribute only 4% and 3% respectively.

Economy 15%

List of Upcoming Branded Hotels in Chennai



Bu

ckin

gh

am

Can

al

Velachery

Perungudi

Thiruvanmiyur

IndiraNagar

KasturbaNagar

Mandaveli

Thriumayilai

Light House

Tiruvallikkeni

Chepauk

GreenwaysRoad

ChennaiBeach

Fort

ParkTown

Park Town

KotturPuram

Washermanpet

Mannady

ChennaiFort

Vepery

ShastriNagarKilpauk Medical

College

Aminjikarai

ShenoyNagar

AnnaNagarEast

Anna NagarTower

Tirumangalam

Koyambedu

CMBT

Vadapalani

AshokNagar

KK Nagar

SIDCO

Alandur

St. ThomasMount

Minambakkam

ChennaiAirport

AirlinesColony

Officer’s TrainingAcademy

Guindy

Little Mount

Saidapet (UG)

Teynampet (UG)

Gemini (UG)

ThousandLights (UG)

LIC (UG)

Egmore (UG)

Taramani

Puzhuthivakkam

Arumbakkam

Mundakanniamman Koil

Tirusulam

Guindy

Minambakkam

Pazhavanthangal

St. ThomasMount

Nungambakkam

Chetpet ChennaiEgmore

Saidapet

Kodambakkam

Mambalam

Villivakkam

Korattur

Pattaravakkam

PeramburLoco Perambur

Carriage

Perambur

VyasarpadiJeeva

Royapuram

Korukkupet

ChennaiBeach

ChennaiFort

ChennaiCentral

ChennaiPark

BasinBridge

Pallavaram

Chromepet

Ambattur

Thirumullaivoyal

Tambaram

31

Apollo

Shiva Temple

Vels Collegeof Science

IndianInstitute of

Technology

RajBhawan

CosmopolitanClub Golf Links

AmericanInternational

School WorldBank

MGRFilm City

Gem GranitesLimited

CognizantTechnology

Solution

Chennai Airport

Domestic

International

RaceCourse

GuindyNational

Park

Chennai SnakePark

Malar

AnnaMGR

ChidambaramStadium

Inter State Bus Terminal

Vijaya

AVMRajeswari

Udayam

Kaliappa

AnnaFlyover

My Fortune

Hyatt Regency

Raintree Anna Salai

TheResidency

Courtyard

GRT Grand

The ResidencyTowers

Royapettah

FortSt. George

VictoryWar

Memorial

Ega

Sangam

Gaiety

Satyam

TajCoromandel

Airway

Trident

Radisson

Le Meridien

Empee Hilton

ITC Grand Chola

Hyatt

Lemon Tree

Westin

Ramada

Sarovar Hometel

Radisson Blu

The Pride

Comfort Inn

Vivanta

Taj Club House

ThePark

ParkShreaton

Raintree St. Mary's Road

JW Marriot

Royal Orchid

Park Plaza

Ibis

The Leela

Le Meridien

Anantara

SomersetGreenways

Vivanta by Taj Fisherman's Cove

RadissonTemple Bay

SankaraNetralaya

CancerInstitute

MeenakshiDental

DurgabaiDeshmukh

ChennaiPort

Crown

ESI

Institute ofMentalHealth

Abirami

Railway

MadrasMedicalMission

SundaramMedicalFoundation

Nathamuni

Peripheral

Jawahar LalNehru

Stadium

Shri GuruRaghavendraTemple

Madras Instituteof Technology

B A Y

O F

B E N G A L

Kuvam

River

Adya

r R

iver

KuvamRiver

Kuvam

River

AdyarRiver

Kuvam River

Kuvam River

Adyar River

Kuvam River

Adyar River

Ad

am

bakkam

Eri

Bu

ckin

gh

am

Can

al

Velachery Eri

MadippakkamEri

MuvarasanpattuEri

Hastinapuram Eri

KoratturTank

ChitlapakkamLake

AmbatturLake

HA

TT

EP

AY

OR

BAZAR

ROAD

SALAI

MA

ND

AP

AM

RO

AD

GA

ND

HI R

OAD

DU

RG

AB

AI

DE

SH

MU

KH

SA

NT

HO

ME

BE

AC

H R

OA

D

GREENWAYS ROAD

AP

PU

ST

RE

ET

BA

ZA

R R

OA

D

ROAD

HIG

H R

OA

D

CANAL BANK ROADSOUTH

KA

MR

AJ S

ALA

I

ROADCHAMIERS

MANDAVELI

KULATHUR ROAD

CORPORATION ROAD

MAINSTREET

PIL

LAYA

R

KOIL

MG

R M

AIN

RO

AD

CA

NA

L P

UR

AM

RO

AD

AN

NA

SA

LA

I

PE

RIY

AR

SA

LA

I

3RD

AVE

NU

E

BESANT AVENUE

AVENUE

7TH AVENUE

1ST AVENUE

2N

DAV

EN

UE

6T

HA

VE

NU

E

BR

IDG

E R

OA

D

2NDAVENUE

LA

TT

ICE

WEST AVENUE

MAHATMA GANDHI ROAD

4TH CROSS ROAD

KA

NA

GA

M

BO

NN

DE

LH

IA

VE

NU

ER

OA

D

AV

EN

UE

2N

D M

AIN

RO

AD

S

MKN

RO

AD

CO

UR

SE

RO

AD

RA

CE

LIN

K R

OA

D

STA

TIO

NR

OA

D

ALA

ND

UR

RO

AD

MKN ROAD

DURAI

ROAD

1S

TM

AIN

RO

AD

DR

AM

BE

DK

AR

RO

AD

SWAMY

GOVINDAN

BO

AG

NEW

RO

AD

BURKIT ROAD

HABIBIULLAH ROAD

CP

RA

MA

SW

AM

Y R

OA

D

RANGA ROAD

BHARATHIDASAN ROAD

VE

NK

ATAN

AR

AYAN

A R

OA

D

ROAD

BO

AG

RO

AD

NO

RT

H

TH

IRU

MA

LA

IP

ILLA

IR

OA

D

CE

NO

TA

PH

RO

AD

NA

TE

SA

N R

OA

D

SALAIMAGUMNAHSIAVVA

BESANT ROAD

PETERS ROAD

LUZ CHURCH DAOR

LLOYDS ROAD

KA

ST

UR

IRA

NG

A R

OA

D

PETERS ROAD

ROAD

DR

NAIR

ROAD

GAN

DHI I

RW

IN

TR

IPLIC

AT

E

ARUNACHALA STREET

WHITES ROAD

PYCOFTS ROAD

WALAJA ROAD

HIG

H R

OA

D

ROAD

FLA

GS

TAFF

DR ALAGAPPA ROAD

ETHIRAJ ROAD MA

RS

HA

LLS

RO

AD

ADITHANAR

GR

EE

MS

RO

AD

PANTHEON R

OAD

ROAD

S

VR

COLLEGE ROAD

STERLING ROAD

HA

DD

OW

RO

AD

ROAD

CH

OO

LA

IME

DU

HIG

H R

OA

D

TANK BUND

RAMANATHAN ROAD

BRINDAVAN STREET

10TH AVENUE

ANNA MAIN ROAD

RAJAN SALAI

RAJAMANNAR SALAI

4TH

AVEN

UE

PU

LLA

AV

EN

UE

NELSON M

ANICKAM RO

AD

NE

HR

U

AN

NA

AR

CH

RO

AD

PAD

I KU

PPA

M

RO

AD

KA

LIM

MA

N K

OIL

STR

EE

T4TH AVENUE

VA

NA

GA

RA

MA

MB

AT

TU

RR

OA

D

3R

D M

AIN

RO

AD

COLLEGE ROAD

RA

JA S

TR

EE

T

ALA

PP

AK

KA

M M

AIN

RO

AD

ANNA SALAI

AM

BE

DK

AR

RO

AD

BHARATHI SALAI

PERUMAL KOIL STREET

KAMARAJAR SALAI

LA

KE

VIE

W R

OA

D

GURUKKAMBAKKAMMAIN ROAD

VEMBADI VINAYAKAR KOIL STREET

VE

LA

CH

ER

I B

YP

AS

S R

OA

D

KA

RU

NE

EK

AR

ST

RE

ET

VANDIKKARAN STREET

LAKE VIEW ROAD

1ST

MAIN

RO

AD

BA

LA

JI N

AG

AR

MA

IN R

OA

D

SABARI SALAI

PO

NN

IAM

MA

N K

OIL

ST

RE

ET

PILLAIYAR KOIL STREET

2N

D M

AIN

RO

AD

6TH MAIN ROAD

1ST MAIN ROAD

DA

OR

INA

MM

AK

KA

VA

DE

MA

NN

A R

OA

D

NE

HR

U M

AIN

RO

AD

MUVARASANPATTUI MAIN ROAD

DARGAH ROAD

3RD

MA

IN R

OA

D

MU

VA

RA

SA

NP

AT

TU

I

BIG STREET

ME

DA

VA

KK

AM

MA

IN R

OA

D

JAW

AH

AR

LA

LR

OA

D

POONAMALLE HIGH ROAD

(INNER R

ING R

OAD)

HIGH ROAD

POONAMALLE

KODAMBAKKAM

GN

CHETTYROAD

ANNA

SALAI

CATH

ED

RAL

NO

RT

H U

SM

AN

RO

AD

PERIYAR EVR

RADHA KRISHNAN

PYCROFTS ROAD

KA

MA

RA

JAR

SA

LA

I

SA

LA

I

SALAI

ROAD

ANNA SALAI (

MO

UNT RO

AD)

RO

AD

MA

HA

TM

A G

AN

DH

I

HIGH

HIG

H R

OA

D

SA

LA

I

RA

JAJI

ROAD

SO

UT

H U

SM

AN

RO

AD

ELDAMS ROAD

SANTHOM

E

RK

MU

TT

RO

AD

ANNA S

ALAI

(MOUNT ROAD)

THYAGARAYA ROAD

TTK

SA

LAI

ROAD

(IN

NE

R R

ING

R

OA

D)

AN

NA

SA

LA

I

CHAMIERS ST MARY’S

JAW

AR

HA

RLA

LN

EH

RU

RO

AD

GREATSOUTHERN

TRUNK ROAD

MOUNT POONAMALLEE ROAD

VELA

CH

ER

IR

OA

D

ANNA SALAI

MOUNT

BUTT ROAD

ROAD

CA

NA

L B

AN

K R

OA

D (W

ES

T)

SARDAR PATEL ROAD

DR

MU

TH

ULA

KS

HM

I R

OA

D

TARAMANI ROAD

VE

LA

CH

ER

I R

OA

D

OLD

MA

HA

BA

LIP

UR

AM

EA

ST

CO

AS

T R

OA

D

VE

LA

CH

ER

Y M

AIN

RO

AD

VE

LA

CH

ER

Y M

AIN

RO

AD

EA

ST

CO

AS

T R

OA

D

EA

ST

CO

AS

T R

OA

D

OLD

MA

HA

BA

LIP

UR

AM

RO

AD

CA

NA

LP

UR

AM

RO

AD

GANDHI

CSIR ROADROAD

NH

- 45

RO

AD

5TH

SA

LA

IT

HIR

UV

IKA

S

ARCOT ROAD

NSK SALAI

ARCOT ROAD

NORTH PARK STREET

KA

LLI K

UP

PA

M R

OA

D

SO

UT

H P

AR

K S

TR

EE

T

DAIRY ROAD

TE

LE

PH

ON

E E

XC

HA

NG

E R

OA

D

MAIN ROAD

VINAYAKAR KOIL STREETMANIKKA

EA

ST

AV

EN

UE

SOUTH AVENUE

CHENNAI TIRUVALLUR HIGH ROAD

RE

D H

ILLS

RO

AD

PULLAL STREET

PAPER MILLS ROAD

KONNUR HIGH ROAD

MA

DH

AH

IGH

VA

RA

MR

OA

D

MELPATTI PONNAPPA STREET

ROADHIG

H

AN

CH

ER

I

WE

ST

AV

EN

UE

ER

UK

K

MAN

NAPPA

EA

ST

AV

EN

UE

STR

EE

T

MA

NN

AR

SA

MY

KO

IL S

TR

EE

T

RA

JAR

AT

HIN

AM

R

OA

D

CEMENTRY ROAD

VO

C R

OA

D (W

ALL

TA

X R

OA

D)

PR

AK

AS

AM

RO

AD

MIN

T S

TR

EE

T

OLD JAIL ROAD

NETAJI SUBASH CHANDRA BOSE ROAD

TH

AM

BU

ST

RE

ET

BRID

GE R

OADELEPHANT

GATE

MIN

T S

TR

EE

T

ST XAVIER STREET

PURASAVAKKAM HIGH R

OAD

G H ROAD

DEMELLOWS ROAD

PE

RA

MB

UR

BA

RR

AC

KS

RO

AD

STRAHANS ROAD

RO

AD

BRIDGE

BA

SIN

POWDERMIL

LS

RO

AD

YAPPA STREET

SANTHI

PULIANTHOPE HIGH ROAD

BR

ICK

KLIN

RO

AD

KONNUR HIGH ROAD

KK

AM

TA

NK

RO

AD

ANDERSON

ME

DAVA

RO

AD

PERAMBUR HIGH ROAD

KILPAUK GARDEN ROAD

6TH AVENUE

3R

DA

VE

NU

E

2ND AVENUE

1S

TA

VE

NU

E

NEW AVADI ROAD

TIRUVALLUR HIGH ROAD

CHENNAI

CONSTABLE ROAD

AMBATTUR EST ROAD

PA

RK

RO

AD

2N

D M

AIN

RO

AD

SOUTHERN AVENUE

3R

D M

AIN

RO

AD

1ST CROSS ROAD

1S

T M

AIN

S R

OA

D

TH

RU

VA

LLU

VA

R R

OA

D JAW

AH

AR

LA

LN

EH

RU

RO

AD

PERAMBUR MAIN ROAD

NE

WA

VA

DI R

OA

D

CH

EN

NA

I B

YP

AS

S R

OA

D

CHENNAI BYPASS R

OAD

KUNRATHUR ROAD

PAMMAL MAIN ROAD

PO

LLC

HA

LU

R M

AIN

RO

AD

AN

NA

ST

RE

ET

AN

NA

ST

RE

ET

NEHRU STREET

NH - 4



DARGAH ROAD

NH - 4

ThyagarayaNagar

eropalyM

SA

NT

HO

ME

BE

AC

H

ELLIO

TS

BE

AC

H

AnnaUniversity

KotturPuram

TheosophicalSociety

Kapaleeswarar

Mandaveli

BesantNagar

TelephoneNagar

IndiraNagar

OkkiyamThuraipakkam

Kannagi Nagar

NehruNagar

BethalNagar

RajaNagar

KathiparaJunction

MA

RIN

A B

EA

CH

kuapehC

K KNagar

KilAyanamba

Sri lyappaNagar

Sembakkam

Nanmangalam Forest

marupamaR

LakshmiNagar

Kanchipuram

ijalaBragaN

PanchapandavaMalai

Tirusulam

SanthanammalNagar

Chromepet

RadhaNagar Keelkattalai

ThiruttaniNagar

Nemilicherry

Jain Nagar

ArunodhayamNagar

VijayaNagar

Perungudi

KasturbaNagar

ValmikiNagar

Dhandeeswaram

IndiraNagar

CITCampus

Puludivakkam

KodandaramaNagar

VSIEstate

RukmaniNagar

CLRI

Adambakkam

UllagaramNanganallur

Parangi Malai

Manappakkam

GuindyIndustrialEstate

Alappakkam

Vanagaram

Towards Sriperumbudur

Rajankuppam

Koyambedu

AlwarThirunagar

Virugambakkam

EkkaduThangal

Arumbakkam

Trustpuram

ShenoyNagar

Tiru VikaPark

ThousandLights

Pudupet

Chintadripet

Gopalapuram

Palmgrove

SIDCOIndustrialEstate

RajaAnnamalaiPuram

Pelican Paradise

PanagalPark

Chetpet

AshokNagar

Teynampet

CHENNAI

KANCHIPURAM

CH

EN

NA

I

KA

NC

HIP

UR

AM

CH

EN

NA

ITIR

UVA

LLUR

Choolaimedu

RamappaNagar

Pallavaram

Aminjikarai

Kannan Nagar

Velachery

Taramani

Palavakkam

Thiruvanmiyur

GuindyAdyar

ArudraIndustries

Mugalivakkam

Nandambakkam

TIRUVALLUR

KANCHIPURAM

Porur

Nolambur

GoldenGeorgeNagar

Vadapalani

Jaffarkhanpet

Nungambakkam

Kilpauk

Egmore

Royapettah

Saidapet

Alwarpet

Pallikaranai

Neelankaral

Vettuvankeni

Palavakkam

Perungudi

Puzhuthivakkam

Old Pallavaram

Neela

ngara

i Beach

SrinivasaNagar

Velachery

Kodambakkam

Mambalam

Nandanam

Nerkundram

MahakaviBharathiyarNagar

Kathibada

Sowcarpet

George Town

Kasimedu

Mannady

Pulianthope

Muthialpet

Royapuram

Old Washermanpet

Washermanpet

Siruvallur Vyasarpadi

Otteri

Vepery

EkangPuram

Purasavakkam

Kondithope

AnnaNagarEast

Dunlop

Ambattur

Mannurpet

JayalalithaNagar

TVSIndustries

SidcoIndustrialEstate

PeriyarNagar

AmbatturIndustrialEstate

Padi

AnnaNagarWest Extn

BalajiNagar

PoompukarNagar

Agaram

Venkatapuram

Attipattu

Chennai

Anna Nagar

Ayanvaram

Perambur

Peravallur

Korukkupet

Ambattur

Kil Ayanambakkam

Maduralvoyal

Ayappanthangal

Pallavaram

Chitlapakkam

SriperumbudurPallavaram

Tambaram

Bethel Nagar

MGRNagar

Nilangarai

Existing Route

Corridor 1 Stations

Corridor 2 Stations

Existing Route Stations

CHENNAI MRTS ROUTE PLAN

Corridor 1

Corridor 2

CHENNAI

A B C D E

1

2

3

4

5

W

S

SW

N

NW

SE

NE

E

COPYRIGHT © JONES LANG LASALLE 2012. All rights reserved.

Designed and published by Jones Lang LaSalleMAP NOT TO SCALE

Nandanam

1

2

3

4

5

A B C D E

2311

12

21

19

17

18

1615

14

1013

129

6

3

1

2

4

7

5

11

8

22

20

8

6

4

3

2

1

5

7

24

10

9


Existing Hotels1 The Pride2 Comfort Inn Marina Towers3 Radisson Blu City Center4 Vivanta by Taj Connemara5 Taj Club House6 Taj Coromandel7 The Park8 The Residency9 Courtyard by Marriott10 GRT Grand11 The Residency Towers12 My Fortune13 Hyatt Regency14 Raintree Anna Salai15 Sheraton Park Hotel & Towers16 Raintree St. Mary’s Road17 Hilton18 Somerset Greenways19 Lemon Tree20 Le Meridien21 Radisson Blu22 Trident23 Vivanta by Taj Fisherman’s Cove24 Radisson Blu Resort Temple Bay25 Ginger26 Fortune Hotel Select Palms27 Aloft28 Asiana29 Quality Inn Sabari

Upcoming Hotels1 Ibis2 Royal Orchid3 Park Plaza4 JW Marriott5 The Leela Palace6 Park Hyatt7 ITC Grand Chola8 Westin9 Ramada10 Sarovar Hometel11 Le Meridien12 Anantara13 Trader’s Hotel14 The Gateway Hotel15 Fraser Residence16 Ibis17 Novotel


Hotel Trading Performance

Source: Jones Lang LaSalle Hotels Research, India*YTD 2011-12: April to December 2011

Chart 6: Market Wide Performance of Branded Hotels in Chennai

7,000

0.02010-112009-102008-09

ADR,

Rev

PAR

(INR)

6,000

5,000

4,000

3,000

2,000

1,000

56.0%

70.0%

68.0%

66.0%

64.0%

62.0%

60.0%

58.0%

Occu

panc

y (%

)

ADR RevPAR Occupancy (%)

The graph below represents marketwide performance of branded hotels in Chennai, beginning FY 2008-09 through 2011-12 (year-to-date).

Similar to other Indian cities, RevPAR in Chennai peaked in 2008-09 at INR 4,400 before declining over the next year as demand conditions softened and new supply emerged. During 2010-11, occupancy levels reached 68%, which is 4% higher than the market high of 64% in 2008-09 and boosted by the overwhelming rise in domestic as well as international passenger traffic resulting from stabilising global economies. Offsetting this has been the continued decline in average rates with ADR averaging INR 6,100 in 2010-11, 12% below the 2008-09 high of INR 7,000.

For YTD 2012, occupancy levels registered a decline of 300 basis points to reach 65%. A significant increase in supply can be attributed to this decline. Average rates, however, remained stable during this period at approximately INR 6,100.

S. No. Hotel Rooms Year 1. Radisson Blu City Center 160 1Q 20122. Hyatt Regency 327 3Q 20113. Somerset Greenways 188 3Q 20114. Hilton 200 1Q 2011

Total 875

8,000

YTD 2011-12*

Recent Hotel Openings


ConclusionChennai has emerged as India’s bustling business destination with the growth of manufacturing (automobile) and service (BFSI, IT/ITeS) sectors, supported by excellent road, rail and air connectivity, as well as a large sea port.

Growing business activity in the region has caught the attention of developers and operators, resulting in an inflow of branded hotel inventory into the market. Chennai currently has 29 hotels with an inventory of 4,656 rooms. The existing supply in Chennai is expected to experience a significant increase with an upcoming inventory of 3,620 rooms spread across 17 hotels within three years.

As a result of growing demand, occupancy levels have been fairly stable during the past four years. However, with a

continuous addition of branded supply, the market has witnessed a decline in average rates. Because of this, there has been an 11% decline in RevPAR since 2008-09.

In the near term, we expect marketwide average rates and occupancy levels to remain constrained as new supply opens in 2012 and 2013, with a high proportion of new rooms in the luxury and upper upscale segments. However, the adverse impact is expected to be short-lived with significant commercial and industrial developments planned across the city. In particular, the Sriperumbudur submarket is expected to become an attractive and desirable market for hotel investors and operators as it is emerging as a significant growth corridor in Chennai with no branded hotel supply to date.

Atlanta3344 Peachtree Road, Suite 1200Atlanta, GA 30326United Statestel: +1 404 995 2100fax: +1 404 995 2109

AucklandPricewaterhouseCoopers Tower Level 16, 188 Quay StreetAuckland, New Zealandtel: +64 9 366 1666fax: +64 9 358 5088

Bangkok19/F Sathorn City Tower175 South Sathorn RoadTungmahamek, SathornBangkok 10120Thailandtel: +66 2 624 6400fax: +66 2 679 6519

BarcelonaPasseig de Gracia 114a Planta, Esc. A08007 BarcelonaSpaintel: +34 93 318 5353fax: +34 93 301 2999

Beijing11/F China World Tower1 Jianguomenwai AvenueBeijing 100004China (PRC)tel: +86 10 5922 1300fax: +86 10 5922 1346

BirminghamNo.1 Colmore SquareBirmingham B4 6AJUnited Kingdomtel: +44 121 643 6440fax: +44 121 634 6510

BrisbaneLevel 33, Central Plaza One345 Queen StreetBrisbane QLD 4000Australiatel: +61 7 3231 1400fax: +61 7 3231 1411

Buenos AiresAv Cordoba 673 7th Floor C1054AAS Buenos Aires Argentina tel: +54 11 4893 2600fax: +54 11 4893 2080

Chicago200 E Randolph DriveChicago IL 60601United Statestel: +1 312 782 5800fax: +1 312 782 4339

Dallas8343 Douglas Avenue,Suite 100Dallas TX 75225United Statestel: +1 214 438 6100fax: +1 214 438 6101

Denver1225 Seventeenth StreetSuite 1900 Denver, CO 80202United Statestel: +1 303 260 6500fax: +1 303 260 6501

DubaiEmaar Square, Building No1 Office 403 PO Box 214 029, Sheikh Zayed Road, Dubai, UAE tel: +971 4 426 6999 fax: +971 4 365 3260

DüsseldorfKaistrasse 540221 DüsseldorfGermanytel: +49 211 13006 0fax: +49 211 13399 0

ExeterKeble House Southernhay East Exeter EX1 1NTtel: +44 1392 423696fax: +44 1392 423698

FrankfurtWilhelm-Leuschner-Strasse 7860329 FrankfurtGermanytel: +49 69 2003 0fax: +49 69 2003 1040

Glasgow150 St Vincent Street Glasgow G2 5ND United Kingdomtel: +44 141 248 6040 fax: +44 141 221 9032

IstanbulYesim Sk. No:2 34335 Akatlar, Levent Istanbul, Turkeytel: +90 212 350 0800fax: +90 212 350 0806

JakartaIndonesia Stock Exchange BuildingBuilding Tower 2, 19th Floor,Sudirman Central, Business DistrictJl. Jend Sudirman Kav 52-53Jakarta 12190, Indonesiatel: +62 21 2922 3888fax: +62 21 515 3232

LeedsSt Paul’s HousePark SquareLeeds LS1 2NDUnited Kingdomtel: +44 113 244 6440fax: +44 113 245 4664

London30 Warwick Street London W1B 5NHUnited Kingdomtel: +44 20 7493 6040fax: +44 20 7399 5694

Los Angeles515 South Flower Street, Suite 1300Los Angeles, CA 90071United Statestel: +1 213 239 6000fax: +1 213 239 6100

Lyon55, avenue Foch69006 LyonTel: +33 4 78 89 26 26Fax: +33 4 78 89 04 76

MadridPaseo de la Castellana, 51Planta 528046 MadridSpaintel: +34 91 789 1100fax: +34 91 789 1200

ManchesterOne Piccadilly GardensManchester M1 1RGUnited Kingdomtel: +44 161 828 6440fax: +44 161 828 6490

MelbourneLevel 21, Bourke Place600 Bourke StreetMelbourne VIC 3000Australiatel: +61 3 9672 6666fax: +61 3 9600 1715

Mexico CityMonte Pelvoux 111, Piso 5Lomas de ChapultepecMéxico, DF 11000tel: +52 55 5980 8054fax: +52 55 5202 4377

Miami2333 Ponce de Leon Blvd, Suite 1000Coral Gables, Florida 33134United Statestel: +1 305 529 6345fax: +1 305 529 6398

MilanVia Agnello 820121 MilanItalytel: +39 02 8586 8672fax +39 02 8586 8670

MoscowKosmodamianskaya Nab. 52/3Moscow 115054Russiatel: +7 495 737 8000fax: +7 495 737 8011

Mumbai1st Floor,2 Brady Gladys Plaza,1/447 Senapati Bapat Marg,Lower Parel,Mumbai - 400 013, Indiatel: : +91 22 3985 1400fax: +91 22 2496 0324

MunichHighLight Munich Business TowersMies-van-der-Rohe-Strasse 680807 MunichGermanytel: +49 89 2900 8882fax: +49 89 2900 8888

New DelhiLevel 9 Tower AGlobal Business Park,Mehrauli Gurgaon Road, Sector 26,Gurgaon 122002Haryana, IndiaTel: +91 124 331 9600Fax: +91 124 4605001

New York601 Lexington Avenue33rd Floor New York NY 10022United Statestel: +1 212 812 5700fax: + 1 212 421 5640

Paris40-42, rue La Boétie75008 ParisFrancetel: +33 1 4055 1718fax: +33 1 4055 1868

Perth Level 29Central Park152 - 158 St Georges TerracePerth Western Australia 6000tel: +61 8 9322 5111fax: +61 8 9481 0107

RomeVia Bissolati 20 00187 Rome, Italytel: +39 06 4200 671fax: +39 06 4200 6720

São PauloRua Joaquim Floriano, 72 - cj. 97 04534-000 São Paulo, SPtel: +55 11 3043 6900 fax: +55 11 3043 6999

San FranciscoOne Front Street, Suite 300San Francisco, CA 94111United Statestel: +1 415 395 4900fax: +1 415 955 1150

Shanghai25/F Tower 2 Plaza 661366 Nanjing Road (West)Jing An DistrictShanghai 200040China (PRC)tel: +86 21 6393 3333fax: +86 21 6393 7890

Singapore9 Raffles Place#38-01 Republic Plaza Singapore 048619tel: +65 6536 0606fax: +65 6533 2107

SydneyLevel 26, 420 George StreetSydney NSW 2000Australiatel: +61 2 9220 8777fax: +61 2 9220 8765

Tokyo3rd Floor, Prudential Tower2-13-10 NagatachoChiyoda-kuTokyo 100-0014, Japantel: +81 3 5501 9240fax: +81 3 5501 9211

Washington D.C.1801 K Street NWSuite 1000Washington, DC 20006United Statestel: +1 202 719 5000fax: +1 202 719 5001

Jones Lang LaSalle Hotels, Jones Lang LaSalle Hotels is a global real estate services firm focused exclusively on hotels & hospitality. We provide acquisition and financing advice, valuations, invest-ment sales and asset management for luxury hotels, select service and budget hotels, smaller hotels and pubs, from single assets to large portfolios and mixed-use developments. In the last five years we completed nearly 4,000 advisory and valuation assignments and more sale, purchase and financing transactions than any other hotels real estate firm in the world… worth over $30 billion. With 43 offices in 20 countries and 265 hotels real estate experts, no other firm is better connected. Through our depth and breadth of research and experience, with 75 Research Reports each year, we know the market at every level, we know the players and we know how to get results.

COPYRIGHT © JONES LANG LASALLE IP, INC. 2012. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.

www.joneslanglasallehotels.com

Jones Lang LaSalle Hotels offices

Market Insight - Moneycontrol

Documents

Transcript of Market Insight - Moneycontrol