Minimum rate to generate more revenue for City hotels

Shirajiv Sirimane

City hotels would be able to generate additional revenue of 30 per cent with the introduction of the minimum room rate system.

The hoteliers expect to generate US$ 9 million annually with the implementation of this system.

President, City Hotels Association S. Shanthikumar said there are 22 hotels offering 3,000 hotel rooms in the City that fall into this category. All these hotels would benefit from it.

He said that the staff would also be able to earn around Rs. 22,000 service charge per month due to increase rates to the hotels. He said that hotels in the City have been classified into six categories and they would charge a minimum room rate ranging from US$ 30 to 105 on a room only basis.

In addition to the room rate, guests would be charged for all other additional expenses, which includes taxes.

Chairman Regulatory Council, City Hotels Association, Cornel Perera said a similar system was in place over 16 years ago but was abandoned due to various reasons.

"However I am confident the system would succeed as there is a monitoring system in place," he said. If there is under cutting hoteliers can complain to the regulatory body that would take action on this.

There is no reason for the system to fail as all hoteliers and the employees benefit from this system".

Perera said a new classification system for City hotels is on the way and it would be implemented soon. "This would help to implement a better standard among Colombo Hotels," he said.

The classification would be introduced by a special panel of locals. He also thanked the Tourism Ministry for the assurance they have given not to interfere with this minimum room rate.

Acting Secretary Ministry of Tourism, George Michael said they are now looking at introducing this format to hotels outside Colombo. "There have been inquiries made from Kandy and Galle districts requesting to implement a system of this nature," he said.