Leisure Hotels Group expands into hostel and resitel market

Eloise Hanson By Eloise Hanson
27 August 2019 | Updated 28 August 2019

India: Dehradun-based hospitality firm, Leisure Hotels Group, is diversifying into the hostel and resitel segment under the Bedz brand.

Aimed at backpackers and long-stay travellers who visit the Himalayan foothill region, Bedz is anticipated to debut in Rishikesh by the end of this year.

Vibhas Prasad, director of Leisure Hotels, said that Bedz will compete with Zostel - one of the largest hostel chains in India. "India has broken grounds with hostels, but of late, most of the action has shifted to co-working and co-living spaces, and hostels are not getting that attention."

Prasad explains that existing hostels in Rishikesh charge on average between INR 250-300 per bed a night, whereas Leisure is planning to charge INR 800-900 for beds per night, and INR 2,000-3,000 for the rooms, creating a concept of community living.

According to Booking.com, India is among the fastest-growing markets in terms of its alternative accommodation offerings, with over 140,000 listings of the total 880,000 falling within this sector.

The alternative accommodation segment includes homestays, hostels, apartments, villas, cabins, tree-houses, boats, and bed and breakfast facilities, among others.

The properties being developed by Leisure under the resitel concept will be open for sale and transfer of ownership. Prasad said that there are no assured returns on the property one buys, however the buyer will receive a yield of 4 per cent when the property is rented back.

Beginning construction at two locations within the next couple of months, Leisure will be developing resitels at Bhimtal, Nainital, Rishikesh, and Naukuchiatal, with a plan to add nine properties across the country by 2021.

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