Helion Venture, after closing $210mn for India fund has invested $4mn in HummingBird Suites Pvt Ltd, service apartment operator.
HummingBird operats 900 rooms (revenue Rs. 11 crore) and plans to expand to 2,500 rooms.
HummingBird has partnered with MNCs, IT Organizations and offers what they call as ‘Hub and Spoke model, where in each “Boutique Residential” property of HummingBird has just 15-20 apartments so that each guest can experience personalized service.
As a one time Traveling salesman i like the idea of service apartments .they provide a much needed service and i trust that with custoemr won’t mind paying a premium for them But don’t you think that timing is a little Odd . With rising Air Fare and upcoming slowdown companies are cutting on Travel and other Non Core expanses. how scalable is the proposition if a service Apartment could be ?
Sure, the timing isn’t perfect, but for a company that isn’t really operating in a saturated / organised market, indeed probably far from it – I don’t think imperfect market conditions will threaten growth. While Air Fares are rising, and companies are cutting back on travel – they’re not cutting it out altogether. Given this fact, they’re still going to need to have to have places for traveling employees to live. A serviced apartment is far more cost effective and often more comfortable than a hotel room – and is therefore a no-brainer. Hats off to the Hummingbird team on a simple, yet brilliant idea.
Gautam Kshatriya
gautam.kshatriya@moneyvidya.com
http://www.moneyvidya.com/blog
“A serviced apartment is far more cost effective and often more comfortable than a hotel room ”
only when you stay for long haul in short haul visit 7-10 days its still a wee bit expensive IMHO
As a frequent traveler to Bangalore, I prefer staying in a hotel for various reasons, safety, hospitality and attention to detail by the staff as it is more professional to name a few. As per the cost effectiveness the entire market is down and companies have become cost conscious, the hotels have understood this and are lowering their tariffs to a great extent. I do get mails from some hotels regarding their rates. Any given day i choose to be in a hotel than a serviced apartment.
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Well, the problem is not so much in the concept of service apartments but rather the way it is being executed. To explain my point I will draw an analogy – some people want to have the benefits of living in a community with security, club facilities, power back-up, etc. as well as want an independent house – solution are the gated villa communities ( no idea why they are being sold at an unnecessary premium though).
Apartment communities are like hotels; independent houses are like the apartments converted into service aparments (current scenario) but the need I think is for a mix of the two – which is basically what the extended stay hotels in US have done like Residence Inn, Townplace Suites, Hawthorn Suites and a plethora of others