Ayodhya’s hotel infrastructure a work in progress as the city awaits more premium properties

With the temple town anticipated to witness a substantial increase in tourist and pilgrim footfall, attracting both domestic and international travellers, the current supply of hotels is limited.

Much has been talked about the influx of tourists Ayodhya is expected to see with the inauguration of Ram Temple but the hotel infrastructure growth is yet to keep up with the growing number of travellers coming to the city.

Ayodhya, still an emerging hotel market, has seen a significant boost in hotel signings and development work but at the moment, the market is dominated by unbranded hotels, and only three branded hotels (Park Inn By Radisson, Clarks Inn Express, Cygnett Collection KK Hotel) have opened recently, said Mandeep Singh Lamba, President, South Asia, HVS ANAROCK, a hospitality consultancy firm.

With the temple town anticipated to witness a substantial increase in tourist and pilgrim footfall, attracting both domestic and international travellers, the current supply is limited.

Limited supply

"Demand is going to far exceed supply as the city has over 200 quality accommodations. In terms of tourist footfalls, government reports indicate that the new Ayodhya airport, in its initial phase, is poised to handle 10 lakh passengers annually. This number is projected to increase to 60 lakh passengers annually after the completion of the second phase. These figures highlight the potential for expansion in the city's hospitality industry," Lamba said.

The supply availability of hotel rooms is far less than the expected tourist footfall. If the total amount of footfalls is about 10,000 people a day, the stay capacity would be less at about 4,000 people altogether in the hotels segment. So, it is a work in progress when it comes to hotel infrastructure in the city, said Giresh Kulkarni, Founder of Temple Connect and International Temples Convention & Expo (ITCX).

"There are new hotel properties and premises mushrooming across, but it will take time for it to be completely ready for hosting more people coming from all over the world. The city is still migrating from a small town to a large place. It is getting geared up to the standard and quality of other established temple towns like Rishikesh, Haridwar, Kashi, among others."

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Need for premium properties

He added that the city needs a brush up in terms of premium properties catering to middle- and upper middle-class travellers.

"Currently, the travellers visiting the city in big numbers are either preferring homestays or dharamshalas. But as more travellers belonging to the affluent class visit the city, more premium properties will be needed. So, there is a need for a huge amount of infrastructural development in Ayodhya."

Taj's parent company, Indian Hotels Company Ltd (IHCL), in April 2023 announced it would build a 100-room upscale Vivanta and a 120-room Ginger hotel by 2027. The complex with the two hotels, sprawled over five acres, is strategically located at a comfortable driving distance from the upcoming Ayodhya international airport and will cater to both business and leisure travellers, noted Atul Thakkar, Director – Investment Banking, Anand Rathi Advisors Ltd.

UAE-based Lulu group, which has a huge mall in state capital Lucknow, is also coming up with plans to develop a 300-room five-star property. "These high-end hotels will cater to the more affluent pilgrims, while many of the thousands expected to visit the temple are expected to settle for more modest accommodations. For that, the government has licensed 2,500 rooms in 500 homes to be used as homestays," he added.

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While the government has announced a liberal policy for guest houses to augment room capacity in the city, it has also identified sites for hotels, said K.B Kachru, Vice President Hotel Association of India & Chairman Emeritus & Principal Advisor, South Asia Radisson Hotel Group.

He said that branded hotels are expecting a surge in demand both in the short- term and long-term and they have been quick to invest in the destination. "Park Inn by Radisson has already opened its doors. Others are in different stages of development. Ayodhya, if developed comprehensively and in a sustainable manner, with effective positioning and marketing has immense potential for the tourism and hospitality sector. The sector is among the largest contributors to GDP globally."

There has been a notable shift in the market dynamics, with major hotel operators such as IHCL, ITC, Marriott, and Wyndham announcing their foray into the city, Lamba said. "In addition, prominent developers like the House of Abhinandan Lodha are undertaking projects for large hotels in the upscale to luxury segments. These new properties are projected to open within the next 3 to 5 years, signalling a significant transformation in Ayodhya's hospitality landscape."

An ITC spokesperson said that they have been approached by developers and owners interested in hotel development and are currently evaluating opportunities across their brands to bring them to Ayodhya.

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"The hotel industry has to increase the development in Ayodhya. And there is a huge scope for the hospitality industry especially with major players entering the city," said Indraneel Dasgupta, Managing Director and Founder, My Tirth India, a pilgrimage and darshan platform.

Town's transformation

OYO's Ritesh Agarwal anticipates a 10x growth in Ayodhya's tourism this year.

"The town has transformed, there is a new airport, the road infrastructure is good. A couple of hours drive from Lucknow, there is Ayodhya Dham railway station, the city's infrastructure is developing. Ayodhya will become one of the most prominent global spiritual tourism centres in the years to come. Every major hotel chain will have property in the city in the next 5-6 years," Agarwal said.

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Ayodhya, which is expected to surpass global spiritual destinations like Mecca and Vatican City in tourist footfalls, is seen as the biggest opportunity for Indian tourism, attracting both domestic and international travellers.

"A large percentage of domestic tourism continues to be pilgrimages, religious and spiritual. Now for destinations like Ayodhya, there would be interest from countries like Sri Lanka, Indonesia, Singapore, Laos, Cambodia, Malaysia and others. With a huge diaspora spread across the world, Ayodhya could attract global interest. Uttar Pradesh attracts a large percentage of foreign tourists and accounts for a significant percentage of domestic visits. There has been almost a triple-fold increase in travellers to Ayodhya as compared to 2017," Kachru added.