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The Taste With Vir: Hotels and the changing trends

by Index Investing News
October 10, 2023
in Opinion
Reading Time: 7 mins read
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We have always liked large hotels in India. One of the many interesting stories concerning Mumbai’s iconic Taj Mahal Hotel is about a phase in the early 1960s when the hotel was a mess and the Tatas did not know what to do with it.

The Taste With Vir: Hotels and the changing trends(Unsplash)
The Taste With Vir: Hotels and the changing trends(Unsplash)

As was common, in that era, they considered getting an international chain to run it. In those days, Hilton was the world’s pre-eminent chain and the Tatas approached it with what should have been an unbeatable offer: Would Hilton take over the Taj? Despite its current problems, it was an iconic property and would mark Hilton’s entry into India.

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Hilton sent its people to look at the hotel. The location, they told the Tatas, wasn’t so bad. But the hotel was old, decrepit and had too few rooms. They would take it over only if they were allowed to raze the building to the ground and to construct a huge, gleaming new hotel with twice the number of rooms.

For obvious reasons, nothing came of this proposal. The Tatas continued to run the hotel themselves, cleaned up the management and then built India’s largest hotel chain around the reputation and image of the original Taj.

But they liked Hilton’s suggestions about the need for a large hotel. First, they added one whole floor to the old Taj. This was done so skilfully that most people still don’t notice that one floor is newer than the rest of the building. Then they pulled down the old Green’s Hotel, which was next door and constructed a new tower wing for the Taj. In the process, they did exactly what Hilton had suggested — double the number of rooms — but without any of the cultural vandalism the Americans had wanted.

Size has remained the guiding principle for most Indians hotels. It creates economies of scale and it allows the hotel to provide facilities that would not be economically viable with a smaller room base. That’s why most Indian hotels are big and grand.

Even after the Taj had turned itself around and begun to take over palace hotels, it looked for a room base that was large enough to make the hotels economically viable. The Lake Palace was run by the Maharana of Udaipur for many years till he handed it over to the Taj. One of the first things the Taj did was to add a new wing insisting that the hotel needed more rooms if it was to become profitable. (Of course, they did this so skilfully as well that most guests can’t tell which are the new rooms and which are the old.) Likewise, with Jaipur’s Rambagh Palace hotel. The Taj built modern new rooms in the lower ground floor area of the hotel where no royals had ever stayed.

You can’t argue with the logic: Both hotels ran at a loss till the Taj took them over. Now, they are money-spinners and among the most famous hotels in the world.

But does the fascination with huge hotels still make sense in this day and age? I ask because I have just returned from one of the most beautiful hotels in the world (among the top ten in the recently announced list of the World’s 50 Best Hotels), the Four Seasons in Florence.

It has acres and acres of grounds and is located in what is officially classed as the largest private park in Florence. The hotel has two wings: One is a 15th century palazzo and the other used to be a medieval convent. Neither building is particularly large and should the Four Seasons have so desired they could easily have constructed one or two more blocks of rooms on the vast grounds. As land is the most important component of the cost of any hotel,, they could have made double or three times the profit that the hotel is now making.

It is not that the Four Seasons, as a chain, is necessarily averse to large hotels: I stayed last year at the Four Seasons in Sydney which is massive. It is more, I suspect, that it cares about matching the size of the hotel to the location and the ambience.

The Four Seasons, Florence, is steeped in history. Though the construction dates to the 15th and 16th centuries, most of the decorations come from the 18th and 19th centuries. The walls are filled with beautiful frescos and the ceilings blaze with art. Sometimes when I woke up in the morning and looked at the ceiling of my room I wondered if I had spent the night in some secular version of the Sistine Chapel.

Even the bathrooms had a sense of place. If you looked out of the window you saw acres and acres of gardens. And if you looked up from the bath, your eyes were met by medieval frescos of stunning beauty.

The lobby was like no hotel lobby I have ever seen. At its centre was a large medieval statue. The floor was paved with beautiful titles and there were flowers everywhere. Because it is a small hotel, it was able to tuck the reception area into a small room by the side. The lobby area was once the courtyard of the palazzo, so it had the air of an atrium that might have been designed by Leonardo da Vinci — if Leonardo did atriums.

The Four Seasons, Florence, is globally praised and has a prominent place in many design books, so my admiration was neither novel nor unusual. But it did lead me to ask the obvious question: Do we in India sometimes put grandeur and largeness ahead of pure beauty?

The Italians have an advantage over us. With the exception of the Lake Palace, which the maharanas never really lived in (they treated it as a small pleasure palace and lived across the lake in a much larger palace) which is several centuries old, most of our palaces are relatively recent constructions. Umaid Bhawan in Jodhpur and the Rambagh Palace in Jaipur are 20th century constructions without the history attached to European chateaux and palazzos.

The Lake Palace has cosy corners (and some very cosy rooms) but most of our palaces focus on size and grandeur, not beauty. There are, of course, castles and so-called palaces owned by Thakurs and members of the landed gentry which have been turned into hotels but very few of the ones I have stayed at have either centuries of history or much beauty.

Nor are we willing to combine architectural and natural beauty. There are many wonderful Goa hotels but they all take the line that the sea and the beach are more than enough to go keep guests satisfied. (These days, not even that; such is the rush for Goa that hotels don’t even need to be near the sea to attract guests.)

And yet abroad, even hotels that have the benefit of the seaside do not take the architecture for granted. You have probably seen Season Two of The White Lotus which is set in the San Domenico Hotel in the Sicilian town of Taormina (now run by the Four Seasons) so you will know what I mean when I say that even without the beauty of the sea, and the rocks, the hotel is simply stunning. (The world seems to agree. After The White Lotus, so great is the demand that the hotel is booked up for months on end.)

But perhaps the trend is changing. Because there is more prosperity now, Indian guests are willing to pay more for hotels than we were in the past. This means that you don’t need to build huge hotels to be economically viable. Smaller properties can easily pay for themselves. And when you build small hotels – at whichever end of the market – you can focus more on making every room special and every corner beautiful.

The success of the Postcard chain of small hotels (disclosure: The chain is run by Kapil Chopra who founded Eazydiner with me, though Postcard is a separate company with its own investors) which gets high rates for small (10 or 12 rooms even) properties shows that the Indian market is moving away from the grand hotels of old: Postcard is so successful that it is building another 25 hotels.

And the big chains are taking note too. This time in Goa, I stayed at the Storii in Moira. It is a tiny hotel, not at the top of the market (half the price of say, the ITC Grand Goa), but it was lovely, charming, looked out into the fields and managed to include a small garden with private plunge pools in many of the rooms.

Yes, it was not quite the Four Seasons, Florence. But its success shows that finally, the market is changing.

Big is not always beautiful.

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