Hedonic Pricing strategy for Hotels at Pritampura, Delhi. by Omkar Teli

ECONOMICS FOR BUILT ENVIRONMENT (AUMREAL661)

Group Assignment MBA - Real Estate & Urban Infrastructure

Yash Soni - 8920009 Hitanshu Bhagat - 8920012 Mayuri Mane - 8920019 Omkar Teli - 8920025 Ebey Simon - 8920047 Guided By: Prof. Dr. Deva Dubey

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TABLE OF CONTENTS TABLE OF CONTENTS ........................................................................................................................ 1 LIST OF TABLES ................................................................................................................................. 2 LIST OF FIGURES ............................................................................................................................... 2 1. INTRODUCTION ............................................................................................................................ 5 2. OBJECTIVE ..................................................................................................................................... 5 3. PROBLEM STATEMENT ................................................................................................................. 5 4. METHODOLOGY ............................................................................................................................ 5 4.1. DATA COLLECTION ................................................................................................................. 5 4.2. UNDERSTANDING THE HEDONIC PRICING MODEL ............................................................... 5 5. CITY LEVEL ANALYSIS: D

.............................................................................. 6

5.1. INTRODUCTION ..................................................................................................................... 7 5.2. HOTEL RENTAL ANALYSIS ...................................................................................................... 9 5.3. CONCLUSION ....................................................................................................................... 15 6. RISK AND ASSUMPTION .............................................................................................................. 16 7. RECOMMENDATION ................................................................................................................... 16 7.1. INFORMATION OF CLIENT ................................................................................................... 16 7.2. PRICING STRATEGY .............................................................................................................. 16 8. COMPARISION OF HOSPITALITY SECTOR - BANGKOK & DELHI .................................................. 23 8.1. INTRODUCTION ................................................................................................................... 23 8.2. RESEARCH ON CITY LEVEL.................................................................................................... 23 8.3. TOURISM IN BANGKOK ........................................................................................................ 24 8.3. HOSPITALITY IN BANGKOK .................................................................................................. 27 8.4. HOTEL DETAILS .................................................................................................................... 28 8.5. ANALYSIS.............................................................................................................................. 36 9. SLO AND RICS COMPETENCIES ADDRESSED ............................................................................... 38 9.1 RICS COMPETENCIES COVERED UNDER THIS COURSE ......................................................... 38 9.2. STUDENTS LEARNING OUTCOME (SLO)............................................................................... 39 9.3. COURSE LEARNINGS THROUGH MODULES ......................................................................... 39 9.3.1. Module I........................................................................................................................ 39 9.3.2. Module II....................................................................................................................... 40 9.3.3. Module III...................................................................................................................... 40 9.3.4. Module IV ..................................................................................................................... 41 9.4. LEARNINGS FROM THE PSDA AND GROUP ASSIGNMENT ................................................... 41 9.5. SELF WORK (SW) .................................................................................................................. 41

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9.5.1. SW 1, 3 .......................................................................................................................... 42 9.5.2. SW 2 .............................................................................................................................. 42 9.5.3. SW 4 .............................................................................................................................. 42 9.5.4. SW 5 .............................................................................................................................. 42 9.6. CLASS ACTIVITY .................................................................................................................... 42 9.6.1. Demand Analysis .......................................................................................................... 43 9.6.2. Conclusion .................................................................................................................... 43 9.6.3. Supply analysis.............................................................................................................. 43 9.6.4. Conclusion .................................................................................................................... 43 9.6.5. Cost revenue curve ....................................................................................................... 43 9.6.6. Conclusion .................................................................................................................... 44 9.7. E- LEARNING CONTENT........................................................................................................ 44 9.8. YAMMER .............................................................................................................................. 44 9.9. GLOSSARY ............................................................................................................................ 44 9.10. MID TERM OPEN BOOK EXAM........................................................................................... 45 ANNEXURE ...................................................................................................................................... 46 REFERENCES ................................................................................................................................... 46

LIST OF TABLES Table 1 List of Shortlisted Regions and Hotels in Delhi .................................................................. 10 Table 2 Coefficients of Variables .................................................................................................... 11 Table 3 Variables of 4 Star Category Hotel ..................................................................................... 17 Table 4 Variables for 3 Star Category Hotel ................................................................................... 17 Table 5 Variables of 4 Star Category Hotel ..................................................................................... 18 Table 6 Variables for 3 Star Category Hotel ................................................................................... 19 Table 7 Variables of 4 Star Category Hotel ..................................................................................... 19 Table 8 Variables of 3 Star Category Hotel ..................................................................................... 20 Table 9 Variables for 5-star Category Hotel ................................................................................... 20 Table 10 Variables for 3-star Category Hotel ................................................................................. 21 Table 11 Variables for 4-star Category Hotel ................................................................................. 22 Table 12 Variables for 3-star Category Hotel ................................................................................. 22 Table 13 Rental rates of the hotel from December 9th to December 15th ................................... 28

LIST OF FIGURES Figure 1 Delhi located in map of India.............................................................................................. 7 Figure 2 Prominent Location in Delhi ............................................................................................... 7 Figure 3 Famous Tourist Places in Delhi ........................................................................................... 8 Figure 4 Hotels plotted on map of Delhi City Source: Google My Maps .......................................... 9 Figure 5 Chart showing the Comparison of Hotel Rentals ............................................................. 12

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Figure 6 Average Rental Rates in Chandni Chowk.......................................................................... 13 Figure 7 Average Rental Rates in Chhatarpur ................................................................................ 13 Figure 8 : Average Rental Rates in Pritampura............................................................................... 14 Figure 9 Average Rental Rates in Rohini: ....................................................................................... 14 Figure 10 Average Rental Rates in Naraina Vihar........................................................................... 15 Figure 11 Thailand marked on World Map..................................................................................... 23 Figure 12 Bangkok marked on the map of Thailand ...................................................................... 23 Figure 13 Location of Selected hotels in Bangkok .......................................................................... 27 Figure 14 Comparison of 3-star Category....................................................................................... 36 Figure 15 Comparison of 4-star Category....................................................................................... 37 Figure 16 Comparison of 5-star Category....................................................................................... 37

WORK DISTRIBUTION YASH 8920009

HITANSHU 8920012

MAYURI 8920019

OMKAR 8920025

EBEY 8920047

CITY LEVEL ANALYSIS INTERNATIONAL CITY LEVEL ANALYSIS CLIENT REPORT SLOS AND COMPITENCES

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COVER LETTER

M.O.H.E.Y Real Estate Property Consultant Pvt. Ltd. moheyre@gmail.com

9586041413

Amity University, Mumbai

_______________________________________________________________________________ 10/12/2020 BL Kashyap and Sons Ltd. New Delhi, India Dear Mr Kashyap,

Your request regarding pricing strategy for Business and Mid-Segment Hotels has been completed by doing a market study in five different locations – Chandni Chowk, Chhatarpur, Pritampura, Rohini and Naraina Vihar. The assessment of market study accomplished by regression analysis and your problem regarding hotel pricing is solved by the Hedonic Pricing Method. We have obtained information regarding hotel location and amenities such as Swimming Pool, Shuttle Service, Complimentary Breakfast, Laundry, Restaurant, Complimentary Pickup, WiFi and Parking. Based on our analysis, the calculated pricing strategy is given in this report with a relevant explanation. We look forward to hearing positively from you for further collaboration.

Sincerely, M.O.H.E.Y. Real Estate Property Consultant Pvt. Ltd.

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1. INTRODUCTION As per the requirement of BL Kashyap and Sons Ltd., we as a part of M.O.H.E.Y Real Estate Property Consultant Pvt. Ltd. have made this report. This report includes a current market study of 3-Star, 4-Start and 5-Star category hotels in given five different areas of Delhi – Chandni Chowk, Pritampura, Chhatarpur, Rohini and Naraina Vihar. To understand the current market trends, we have analysed 25 different hotels in these given locations. Afterwards, to determine the pricing strategy for hotels as per the client requirements we obtain variables from the market study and generate the equation. Based on this equation and data related amenities provided by the client, we have calculated the pricing strategy for different category hotels in different areas. Additionally, to understand the pattern of amenities Bangkok city is selected. Amenities wise comparison of Bangkok’s hotels and Delhi’s hotels is given in this report.

2. OBJECTIVE ➢ To determine the relevant pricing strategy for Business Hotels and Mid Segment Hotel for given locations. ➢ To understand the different variables that significantly affect the hotel pricing in different areas. ➢ To identify the difference between consumer willing to pay and prevailing market rates for different hotels. ➢ To compare the international city with the selected city for understanding the pattern of amenities provision.

3. PROBLEM STATEMENT The price of hotels depends on different facilities and locational characteristics. To determine the pricing strategy for hotels understanding of these features and customer’s preference is required. The prices vary accordingly people’s preference for different facilities in hotel and star category of hotel, which need to be taken into consideration. The BL Kashyap and Sons Ltd. consulted M.O.H.E.Y. Real Estate Property Consultant Pvt. Ltd. to assess the rental pricing strategy for hotels in five different areas of Delhi – Chandni Chowk, Pritampura, Chhatarpur, Rohini and Naraina Vihar. The client had given information regarding the location of hotels and amenities which he wants to provide in hotels. The client has demand for pricing strategy of two categories which are Business Hotel (5-Star and 4-Star) and Mid Segment hotels (3-star) based on different variables.

4. METHODOLOGY 4.1. DATA COLLECTION To run the regression, data of different star category hotels collected in five different areas of Delhi - Chandni Chowk, Pritampura, Chhatarpur, Rohini and Naraina Vihar. Data related to amenities that currently provides different hotels, customer review and current Rental price is collected from a secondary source.

4.2. UNDERSTANDING THE HEDONIC PRICING MODEL The Hedonic Pricing Model assists us to understand the significance of different variables that affect the rental price of the hotel. It helps us to identify the extent to which these variables affect the price. For determining the hotel price, variables need to be considered which affects significantly on the rental price of the hotel. This will help to decide variables according to preferences of consumers and based on we can estimate the price that suits consumer’s spending power. By using this method, the occupancy rate of the hotel can be maximized at a certain level.

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5. CITY LEVEL ANALYSIS:

DELHI

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5.1. INTRODUCTION

DELHI, the capital of India, is considered to be the most popular city in terms of hospitality and tourism after Mumbai. The hotel demand in the city is therefore mostly driven by the tourists and leisure segment travels followed by corporate business travels and Government, Judiciary and Administration travels. So, Delhi has always been an outstanding performer in attracts national and international footfall and contributing to growing GDP in Hospitality Sector of Delhi as well as India. Delhi is considered as the heart of the nation with its significant and enriched culture and heritage. The city congregates some of the world-famous historical Figure 1 Delhi located in map of India monuments, thus attracting more and more national Source: Google Maps and international tourists. The influence of religious diversity can be seen in the city along with the cultural impact of the Mughal, the ancient Indian and the British. There are many beautiful gardens in the city, away from pollution and busy city life that provide opportunities to walk leisurely in the midst of greenery. The capital city is divided into two sections popularly known as Purani Dilli or Old Delhi and Nayi Dilli or New Delhi. Old Delhi is popular for its ancient culture and monuments along with its overcrowded gastronomical lanes.

Figure 2 Prominent Location in Delhi Source: Google Images

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Figure 3 Famous Tourist Places in Delhi Source: Google My Maps

The above maps highlight the prominent Landmarks and Tourists Places in Delhi. These places play a major role in inviting business to the hospitality sector of city. It attracts local, national as well as international tourists to the city. The following link will direct to the Google My Maps to show the exact locations of these places: https://www.google.com/maps/d/edit?mid=1adWHezv5dM8RpFbPrb7pLud8wG_vUhP&usp=sharing

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5.2. HOTEL RENTAL ANALYSIS The hotel rentals from five prominent regions of Delhi were studied i.e., Chandni Chowk, Pritampura, Chhatarpur, Naraina Vihar and Rohini. Hotels under 3-star, 4-star and 5-star category were studied and the rental rates of these hotels were analysed by running regression considering various aspects. The figure below shows the shortlisted regions and hotels for further study.

Figure 4 Hotels plotted on map of Delhi City Source: Google My Maps

The following link reflects the better access to locations of individual hotels mentioned in figure 4: https://www.google.com/maps/d/edit?mid=1rqRkkneU9qWBqpFcRgUFsPFe6-OyIBY&usp=sharing All these regions invite maximum national and international tourists to the Delhi city, thus majorly contributing to the hospitality sector of the city. These cities host prominent landmarks, the tourist attraction places, historical monuments, medieval times market places, museums, historic gardens etc. All the visiting crowd to this city is largely catered by 3-star, 4-star and 5-star hotels. Though city has got maximum of 3-star and 4-star hotels, 5-star hotels are comparatively low. The study was conducted on 25 hotels, 5 hotels from 5 regions each. These hotels are a mix of 3, 4, 5star categories. The rental rate per night for a room of these hotels for the period of 9th December 2020 to 15th December 2020 was examined. Various internal characteristics and externally influencing characteristics were also studied by running a regression. Even the costumer behaviour towards these factors and rental rates was observed in this analysis.

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The table below shows the regions and hotels shortlisted for the further analysis.

OMKAR

MAYURI

REGION

CHANDNI CHOWK

PRITAMPURA

Sr No

HOTEL

LATITUDE

LONGITUDE

Hotel Tara Palace

28.6543

77.2342

Haveli Dharampura

28.65446

77.23253

Hotel Aiwan E Shahi

28.6517

77.2328

Hotel Wall City

28.6565

77.2233

New Frontier Hotel

28.66123

77.22216

Hotel Oasis

28.701947

77.134587

Hotel City Park

28.705562

77.143676

Hotel Sewa Grand

28.690819

77.11977

OYO 8305 Blessings Inn

28.69146

77.105937

28.68411

77.12797

HITANSHU

YASH

CHHATARPUR

NARAINA VIHAR

EBEY

ROHINI

Capital O 12148 Flyover Inn Hotel

Anantkoti Hotel

28.488797

77.184784

The Ocean Pearl Retreat

28.496949

77.185455

Saket Bed and Breakfast

28.477465

77.186855

OYO Townhouse 099

28.500992

77.185833

Lily White Hotel

28.491097

77.184825

Sarovar Portico

28.62632

77.13507

Hotel Picasso Pride

28.62656

77.13545

SK Crown Park

28.62511

77.13549

Hotel Palm Spring

28.63271

77.13757

Liv Inn

28.63135

77.13901

Crowne Plaza

28.72061

77.11127

AP Holiday Inn

28.73032

77.13352

Seven Seas Hotel

28.70536

77.11643

Oyo 65500 Rohini Inn

28.7197

77.07789

Hotel Rama

28.73267

77.08826

Table 1 List of Shortlisted Regions and Hotels in Delhi

The details of all the above hotels, like the rental rates, the amenities provided by the hotels, certain external factors like vicinity of International Airport, Railway Stations etc. is reflected in an excel sheet, the link for which is mentioned below: https://1drv.ms/x/s!AiGqWoLXSghGhEEs5rLt878_chLK

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Considering all these factors, the regression process is carried and the equation for rental rate/night for one room obtained after running the regression for the statistical data of all the hotels is: [Y (rental rate) = M (coefficient) * X (variable) + C (intercept)]

Wherein, Rental rate = Y And Intercept and Coefficients will be: VARIABLES

DESCRIPTION OF VARIABLES

Intercept

COEFFICIENTS -1018.907893

Dist_Airport

Distance from Indira Gandhi International Airport | in km

-10.80317568

Dist_Station

Distance from nearest Railway Station | in km

0.135645849

Dist_Substn

Distance from nearest Sub-Station | in km

-236.8070932

L_mark1

Distance from nearest Landmark 1 | in km

93.46006738

L_mark2

Distance from nearest Landmark 2 | in km

-122.2059961

Star_Cat

Star Category of Hotel | 3-star, 4-star, 5-star

1023.092062

Cust_Revu

Customer Ratings | out of 10

-87.00353106

S_pool

Existence of Swimming Pool | if yes = 1, if no = 0

-297.511569

Shuttle

Existence of Shuttle Service | if yes = 1, if no = 0

-1320.591387

Comp_Bf

Existence of Complementary Breakfast | if yes = 1, if no = 0

-265.054232

Laundry

Existence of Laundry Service | if yes = 1, if no = 0

1589.141512

Restrnt

Existence of Restaurant | if yes = 1, if no = 0

1175.30574

Comp_pkup

Existence of Pick-up and Drop Service| if yes = 1, if no = 0

725.0585234

Wifi

Existence of WIFI Facility| if yes = 1, if no = 0

7623.504379

Parking

Existence of Parking Facility | if yes = 1, if no = 0

-6988.647751

Table 2 Coefficients of Variables

All the above characteristics are the ‘Qualitative Characteristics’ observed in the hotels. The distance of the hotels from the International Airport, the Nearest Railway Station and Nearest Sub-Station, along with the distances from near-by Landmarks is considered in kilometres. The other qualitative characteristics is the provision for various hotel amenities like existence of Swimming Pool, Shuttle Service, Complementary Breakfast, Laundry Service, Restaurant, Complementary Pick-up and Drop Service, WIFI and Parking. These characteristics are measured on a binary scale involving dummy variables, wherein 1 indicates the existence and 0 indicates

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non-existence of those amenities. Two other characteristics i.e., Star Category and Costumer Ratings are also considered. The t statistic is the coefficient divided by its standard error. The standard error is an estimate of the standard deviation of the coefficient, the amount it varies across cases. It can be thought of as a measure of the precision with which the regression coefficient is measured. If a coefficient is large compared to its standard error, then it is probably different from 0. The p-value for each term tests the null hypothesis that the coefficient is equal to zero (no effect). A low p-value (< 0.05) indicates that you can reject the null hypothesis. Also, on comparing the rental rates charged by the hotel to the costumers and the rental rates obtained from the regression equation, we can analyse the financially beneficial hotel for the costumers. And upcoming hotels in Delhi can use this equation to decide their costumer suitable room rentals to increase the footfall. The following chart reflects the rental rate per night of a room charged by hotel and rental rate per night of a room obtained from regression equation.

Figure 5 Chart showing the Comparison of Hotel Rentals

RENTAL RATES CHARGED BY HOTEL RENTAL RATES OBTAINED FROM REGRESSION EQUATION Source: https://1drv.ms/x/s!AiGqWoLXSghGhEEs5rLt878_chLK (excel sheet)

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So, the average rental rates in the 5 regions under various star categories are: RENTAL RATES CHARGED BY HOTEL RENTAL RATES OBTAINED FROM REGRESSION EQUATION

Figure 6 Average Rental Rates in Chandni Chowk

Figure 7 Average Rental Rates in Chhatarpur

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Figure 8 : Average Rental Rates in Pritampura

Figure 9 Average Rental Rates in Rohini:

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Figure 10 Average Rental Rates in Naraina Vihar

5.3. CONCLUSION The study of rental rate / night for a room in 25 hotels of Delhi shows that: • The rates vary on the basis of star category of hotel and the facilities provided by the hotel to the customers. • Existence of external factors, like large number of historic landmarks, the tourist attraction places, the Markets, etc. in the vicinity also influences the rental rates of the hotels. • There is a better accessibility to the hotels through the nearest railway stations, sub-station and the Indira Gandhi International Airport, all of which lies inside the radius of 20 km from the core of the region adds to the external factors impacting the rental rates. • These external factors play a vital role in inviting major attention of national as well as international tourists, thus elevating the hospitality and tourism business in Chandni Chowk. • The rental rates for weekends and weekdays vary in some hotels. Its higher on weekends as compared to that on weekdays. So even the weekend – weekday factor also impacts the rental rates. • The analysis after regression shows that the rental rates for all the 25 hotels are within the pertaining limits, thus leaving a positive and ever welcoming impact on its customers, which is seen to be highly appreciated by the costumers through the costumer ratings (+7/10) for all the hotels. Thus these 25 hotels in Delhi proves to be the mostly opted hotels by the costumers considering the rental rates, facilities provided by the hotel along with major add-ons of external factors like site seeing and shopping areas in the vicinity with easy accessibility.

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6. RISK AND ASSUMPTION ➢ The prices estimated from the Hedonic Pricing Model is only for a one-night stay. Although, it may vary as the number of nights change. ➢ Higher demand and less availability of hotel rooms also affect the determined prices. The prices can increase if available rooms are less because of the wedding or events in the hotel. ➢ The prices can also vary in festivals and public holidays because the high number of tourists can be booking the rooms in festival seasons. ➢ The determined prices need to be revised if any new hotel provides rooms with same facilities at a lower price in nearby areas.

7. RECOMMENDATION 7.1. INFORMATION OF CLIENT The BL Kashyap and Sons Ltd. consulted M.O.H.E.Y. Real Estate Property Consultant Pvt. Ltd. to assess the rental pricing strategy for hotels in five different areas of Delhi – Chandni Chowk, Pritampura, Chhatarpur, Rohini and Naraina Vihar. The client had given information regarding the location of hotels and amenities which he wants to provide in hotels. The client has demand for pricing strategy of two categories which are Business Hotel (5-Star and 4-Star) and Mid Segment hotels (3-star). We as a part of the M.O.H.E.Y Consultant has completed the market study in these given areas based on the different criteria given by the client.

7.2. PRICING STRATEGY To analyse the factors which affect on rental rates of a hotel, we have run the regression based on different variables. We have predicted the rental rates for both categories which are Business Hotel and Mid Segment for five different areas. The equation for estimating the rental value based on a different variable is as follows: ROOM RENTAL = [(-10.8031)*DA] + [(0.1356)*DS] + [(-236.8070)*DSS] + [(93.46)* LM1] + [(122.2059)*LM2] + [(1023.0920)*SR] + [(-87.0035)*REV] + [(-297.5115)*SWPOOL] + [(1320.5913)*SS] + [(-265.0542)*CBF] + [(1589.1415)*Laundry] + [(1175.3057)*RST] + [(725.0585)*CPKUP] + [(7623.5043)*Wi-Fi] + [(-6988.6477)*PK] + (-1018.9078) The information about amenities which client wants to provide and the predicted variables based on the market for Chandni Chowk area are mentioned below:

Location: Chandni Chowk Star Rating (SR) Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

8 17.4 2.2 1.4 0.17 0.2

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS)

No Yes

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Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

Yes Yes Yes Yes Yes Yes

Table 3 Variables of 4 Star Category Hotel

Room Rental= (-10.8031)*17.4+(0.1356)*2.2+(-236.8070)*1.4+(93.46)*0.17+(122.2059)*0.2+(1023.0920)*4+(-87.0035)*8+(-297.5115)*0+(-1320.5913)*1+(265.0542)*1+(1589.1415)*1+(1175.3057)*1+(725.0585)*1+(7623.5043)*1+(-6988.6477)*1+(1018.9078) The calculated price for 4-star category for one night as per equation is Rs.4388.

Location: Chandni Chowk Star Rating Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

7.6 16.4 3.08 1.6 1.4 2

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

No No Yes Yes Yes No Yes Yes

Table 4 Variables for 3 Star Category Hotel

Room Rental= (-10.8031)*16.4+(0.1356)*3.08+(-236.8070)*1.6+(93.46)*1.4+( 122.2059)* 2+ (1023.0920)*3+(-87.0035)*7.6+(-297.5115)*0+(-1320.5913)*0+(-265.0542)* 1+ (1589.1415) *1+(1175.3057)*1+(725.0585)*0+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 3-star category for one night as per equation is Rs.2709.

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The information about amenities which client wants to provide and the predicted variables based on the market for Chhatarpur area are mentioned below:

Location: Chhatarpur Star Rating Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

8.4 13 23.2 4.6 7.6 3.6

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

Yes Yes Yes Yes Yes Yes Yes Yes

Table 5 Variables of 4 Star Category Hotel

Room Rental= (-10.8031)*13+(0.1356)*23.2+(-236.8070)*4.6+(93.46)*7.6+( 122.2059) *3.6+ (1023.0920)*4+(-87.0035)*8.4+(-297.5115)*1+(-1320.5913)*1+(-265.0542)*1+(1589.1415) *1+ (1175.3057)*1+(725.0585)*1+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 4-star category for one night as per equation is Rs.3627.

7.8 14 23.2 4.3 5.6 4

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST)

No No Yes Yes Yes

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Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

No Yes Yes

Table 6 Variables for 3 Star Category Hotel

Room Rental= (-10.8031)*14+(0.1356)*23.2+(-236.8070)*4.3+(93.46)*5.6+( 122.2059)* 4+ (1023.0920)*3+(-87.0035)*7.8+(-297.5115)*0+(-1320.5913)*0+(-265.0542)* 1+(1589.1415)*1 +(1175.3057)*1+(725.0585)*0+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 3-star category for one night as per equation is Rs 3374. The information about amenities which client wants to provide and the predicted variables based on the market for Pritampur area are mentioned below:

Location: Pritampura Star Rating Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

8.1 18 14 2.15 1.3 0.6

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

Yes Yes Yes Yes Yes Yes Yes Yes

Table 7 Variables of 4 Star Category Hotel

Room Rental= (-10.8031)*18+(0.1356)*14+(-236.8070)*2.15+(93.46)*1.3+( 122.2059) *0.6+ (1023.0920)*4+(-87.0035)*8.1+(-297.5115)*1+(-1320.5913)*1+(-265.0542)*1 +(1589.1415)*1+(1175.3057)*1+(725.0585)*1+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 4-star category for one night as per equation is Rs 3956.

Location: Pritampura Star Rating 7.4 Review (REV) Distance from Indira Gandhi International Airport 18 (DA) Distance from New Delhi Railway Station (DS) 16.2

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Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

1.09 0.64 1

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

No No Yes Yes No No Yes Yes

Table 8 Variables of 3 Star Category Hotel

Room Rental= (-10.8031)*18+(0.1356)*16.2+(-236.8070)*1.09+(93.46)*0.64+( 122.2059) *1+ (1023.0920)*3+(-87.0035)*7.4+(-297.5115)*0+(-1320.5913)*0+(-265.0542)*1 +(1589.1415) *1+(1175.3057)*0+(725.0585)*0+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 3-star category for one night as per equation is Rs 2852. The information about amenities which client wants to provide and the predicted variables based on the market for Rohini area are mentioned below:

Location: Rohini Star Rating Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

9 18 30 1 12 20

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

Yes Yes Yes Yes Yes Yes Yes Yes

Table 9 Variables for 5-star Category Hotel

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Room Rental= (-10.8031)*18+(0.1356)*30+(-236.8070)*1+(93.46)*12+( 122.2059)* 20+ (1023.0920)*5+(-87.0035)*9+(-297.5115)*1+(-1320.5913)*1+(-265.0542)*1 +(1589.1415) *1+ (1175.3057)*1+(725.0585)*1+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 5-star category for one night as per equation is Rs 3835.

7.5 18.13 8 4.3 25 33

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

No No No Yes No No Yes Yes

Table 10 Variables for 3-star Category Hotel

Room Rental= (-10.8031)*18+(0.1356)*16.2+(-236.8070)*1.09+(93.46)*0.64+( 122.2059)* 1+ (1023.0920)*3 +(-87.0035)* 7.4+(-297.5115)*0+(-1320.5913)*0+(-265.0542)*1+ (1589.1415)*1+(1175.3057)*0+(725.0585)*0+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 3-star category for one night as per equation is Rs. 712. The information about amenities which client wants to provide and the predicted variables based on the market for Naraina Vihar area are mentioned below:

Location: Naraina Vihar Star Rating Review (REV) Distance from Indira Gandhi International Airport (DA) Distance from New Delhi Railway Station (DS) Distance from Sub Station (DSS) Distance from Landmark 1 (LM1) Distance from Landmark 2 (LM2)

8.4 12 5 0.6 8.7 9.4

Amenities Swimming Pool (SWPOOL)

Yes

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Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

Yes Yes Yes Yes Yes Yes Yes

Table 11 Variables for 4-star Category Hotel

Room Rental= (-10.8031)*12+(0.1356)*5+(-236.8070)*0.6+(93.46)*8.7+( 122.2059)*9.4 + (1023.0920)*4+(-87.0035)*8.4+(-297.5115)*1+(-1320.5913)*1+(-265.0542)*1+(1589.1415)*1 +(1175.3057)*1+(725.0585)*1+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 4-star category for one night as per equation is Rs 3977.

7.3 13 5.26 0.64 9 10

Amenities Swimming Pool (SWPOOL) Shuttle Service (SS) Complimentary Breakfast (CBF) Laundry Restaurant (RST) Complimentary Pickup (CPKUP) Wi-Fi Parking (PK)

No No Yes Yes No No Yes Yes

Table 12 Variables for 3-star Category Hotel

Room Rental= (-10.8031)*13+(0.1356)*5.26+(-236.8070)*0.64+(93.46)*9+( 122.2059) *10+ (1023.0920)*3+(-87.0035)*7.3+(-297.5115)*0+(-1320.5913)*0+(-265.0542) *1+(1589.1415) *1+ (1175.3057)*0+(725.0585)*0+(7623.5043)*1+(-6988.6477)*1+(-1018.9078) The calculated price for 3-star category for one night as per equation is Rs 2701. The calculated rental price by using regression equation shows that the prices of Mid Segment Hotels vary from 712 Rs/Night to 3977 Rs/Night and the prices of Business Hotels vary from 3627 Rs/Night to 4388 Rs/Night. The rental price of a Business Hotel in Chandni Chowk is 4388 Rs/Night, which is highest as compared to other areas because of the external factors such as major historic landmarks and better accessibility of New Delhi Railway Station.

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8. COMPARISION OF HOSPITALITY SECTOR - BANGKOK & DELHI 8.1. INTRODUCTION

Figure 11 Thailand marked on World Map Source: Google Map Report 2019

THAILAND, officially known as Kingdom of Thailand is situated in the mid of the mainland Southeast Asia. Tourism is one of the key industries in Thailand. Tourism sector is the main contributor in the economy of Thailand. Due to the increase in tourism sector of Thailand, the demand of hospitality sector also boosted.

8.2. RESEARCH ON CITY LEVEL We have selected Bangkok as our international city for the analysis of Hotels and Tourism. BANGKOK, the capital of Thailand comes in the list of top tourist place visited in the world. It has got its reputation as a biggest travel spot in South Asia. It is also known by the name ‘City of Angels’ and is surrounded by funky market, malls, a lively nightlife scenario, some really good sights and attractions which attracts the tourists by its unique tradition and much more. It is famous for cheap holiday destination. Various Luxurious hotels are located in the city which provides very good hospitality. Thai food is another Bangkok highlight.

BANGKOK

Figure 12 Bangkok marked on the map of Thailand Source: Google Map Report 2019

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8.3. TOURISM IN BANGKOK Bangkok is one of the top visited city with approximately 22.7 million visitors every year. Bangkok has beautiful sights, attractions and city life which attracts the tourists. Historical Temples, Royal Palaces and museums create its major antique attraction and also cultural tourist attraction. Bangkok is also famous for its night life. While, city’s status is well maintained for sex tourism, but it is restrained by Thai government. Major Tourist Attractions in Bangkok are given below:

1. The Grand Palace

2. Safari World

Source: Google Images Report 2019

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3. Siam Ocean World

4. Wat Arun (Temple of Dawn)

5. Temple of Emerald Buddha

Source: Google Images Report 2019

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6. Royal Barge Museum

7. Bangkok National Museum

Source: Google Images

Tourism’s Report positive2019 presentation in Bangkok can be credited to various pull factors which includes welcoming culture, rich natural resources and abundant biodiversity, and also relative affordability. Also, all the attractions mentioned above make the Bangkok a prominent tourist place globally. Through hustle and bustle, massive skyscrapers, ancient Temples, grand palaces and world-famous floating market, this city remains at top for attracting millions of tourists around the world.

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8.3. HOSPITALITY IN BANGKOK The increased tourism sector in Bangkok also leads to massive demand of hotels within the city. Visitors coming from different part of the world looks for a shelter when they reach such beautiful city. There is a huge demand of hotels of all the categories like 3-star hotels, 4-star hotels and 5star hotels. For going in detail about the hospitality sector of Bangkok, we have selected 15 hotels, 5 hotels from 3-star category, 5 hotels from 4-star category and 5 hotels from 5-star category. Below we have marked various hotels on the map of Bangkok.

1 5

5 4

4 3 3

4 5

1 2 2 1

Figure 13 Location of Selected hotels in Bangkok

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8.4. HOTEL DETAILS Witchuwan Apartel

7.2/10

Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phaya Thai, 10400 22.1 km

5.3 km 1.5 km

Source: TripAdvisor, Booking

Description: Roof top pool and terrace are one of the major attractions Another highlight is its location, being almost at the center of the city They provide free shuttle service to Rama 9 MRT Subway Station which is 890m away Prominent landmarks nearby include Art in Paradise and Train Night market. 9th Dec 2020 1980 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 1980 1980 1980 1980 1980 2200

rupees) Table 13 Rental rates of the hotel from December 9th to December 15th

8.6/10

Hyde Park Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phaya Thai, 10400 26 km 3.5 km 5.6 km

Source: TripAdvisor, Booking

Description: Budget friendly hotel with its location just 2 km from the city center Located in the heart of Bangkok and has a Golf course on site Popular landmarks nearby include Siam Paragon (1.5 km) and Jim Thomson House (1.8 km)

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9th Dec 2020 1715 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 1715 1715 1715 1715 1715 1715

rupees) Table showing rental rates of the hotel from December 9th to December 15th

7.6/10

Hi Residence Bangkok Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phaya Thai, 10400 22.5 km 4.9 km 4.4 km

Source: TripAdvisor, Booking

Description: Offers panoramic city view and offer terrace dining as well as gym and outdoor pool with jets Offers a Doctor on call facility throughout. Popular landmarks nearby include Pratunam market and and World shopping mall 9th Dec 2020 3143 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 3143 3143 3143 3143 3143 3143

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8.6/10

Fyn Hotel Bangkok Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phaya Thai, 10400 27.2 km 7.4 km 1 km

Source: TripAdvisor, Booking

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Description: Located in the heart of Bangkok’s victory monument, a historical landmark of the city It features 49 contemporary designed guest rooms and suites Offers a choice of Asian, American or vegetarian breakfast with a selection of fresh fruits A 2 min walk to the victory monument and 2 km from the Pratunam market 9th Dec 2020 2156 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2156 2310 2310 2156 2156 2156

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8/10

Prom Ratchada Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phaya Thai, 10400 21.3 km 12 km 3.6 km

Source: TripAdvisor, Booking

Description: Location is known for shopping outlets and night life especially the local foods Customers can choose from 78 rooms, all of which exude an atmosphere of total peace Prominent landmarks nearby include Art in Paradise and Train Night market 9th Dec 2020 1563 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 1640 1955 1955 1958 1955 1958

rupees) Table showing rental rates of the hotel from December 9th to December 15th

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8/10

Ambassador Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Whatthana, 10110 21.6 km

6.3 km 2.3 km

Source: TripAdvisor, Booking

Description: Affordable and totally worth for the money given and provide both therapy room and spa It has several eco-friendly features incorporated Nana Square and Soi cowboy are the popular landmarks nearby

Date

9th Dec 2020

Rent (in rupees)

3168

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th 2020 2020 2020 2020 2020 Dec 2020 3168 3168 3168 3168 3168 3168

Table showing rental rates of the hotel from December 9th to December 15th

8.6/10

Nouvo City Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Phranakorn, 10200 33.4 km 4.4 km 7 km

Source: TripAdvisor, Booking

Description: Muslim friendly premium halal hotel with a walking distance to many of the area attractions Rooftop swimming pool and large sized rooms Temple of the Reclining Buddha (Wat Pho) is a popular landmark nearby Some authentic Thai street food are the main reasons to attract customers

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9th Dec 2020 2200 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2213 2183 2183 2183 2183 2183

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8.6/10

Mandarin Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Bang Rak, 10500 25.2 km 1.3 km 2.6 km

Source: TripAdvisor, Booking

Description: Established since 1965. Recommended for people those who prefer quite location Popular landmarks such as Siam, Chinatown and Silom are at a walkable distance All the rooms have a microwave oven which is not seen very commonly 9th Dec 2020 2361 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2361 2361 2361 2361 2361 2361

rupees) Table showing rental rates of the hotel from December 9th to December 15th

9/10

Al Meroz Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Suan Luang, 10250 17.6 km 14.1 km 7.7 km

Source: TripAdvisor, Booking

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Description: It is one among the leading halal hotels in the city of Bangkok Ideal location for fun and relaxation and is around the prominent landmarks in the city It has a 24 hour taxi service, security and a well-equipped fitness center 9th Dec 2020 2066 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2066 2066 2066 2066 2066 2066

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8.8/10

Novotel Bangkok Platinum Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Ratchathewi, 10400 24.2 km

2.8 km 2.4 km

Source: TripAdvisor, Booking

Description: Located on top of the Platinum fashion mall which is known for Bangkok’s vibrant fashion This area is one of main areas for shopping in the city Popular landmarks like Siam square and Siam Paragon are at a walkable distance

Date Rent (in rupees)

9th Dec 2020 3221

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2791

2730

Table showing rental rates of the hotel from December 9th to December 15th

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8/10

Prince Palace Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Pom Prap Sattru Phai, 10100 26 km

3.6 km 7 km

Source: TripAdvisor, Booking

Description: Located directly above the Bo Bae tower ,a wholesale clothing market in Old Bangkok It has 2 spa’s and 7 dining options to choose from Shopping attractions like Pratunam and Khaosan Road are a 10-minute drive away

Date

9th Dec 2020 2438 (in

Rent rupees)

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 2438 2438 2438 2438 2438 2068

Table showing rental rates of the hotel from December 9th to December 15th

Oakwood Suites

8.4/10

Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Sukhumvit, 10110 20.7 km 5.7 km 2.3 km

Source: TripAdvisor, Booking

Description: Property is in close proximity to a diverse range of restaurants and malls It offers 228 well-appointed studios and a fully equipped fitness canter Very close to Emporium and BTS sky train only about 5 min walk.

Date Rent (in rupees)

9th Dec 2020 4240

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 4508

2438

4427

Table showing rental rates of the hotel from December 9th to December 15th

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9.2/10

Carlton Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Sukhumvit, 10110 21.2 km 5.2 km 1.6 km

Source: TripAdvisor, Booking

Description: Located at the city centre and it offers 338 elegant rooms and suites Emporium Shopping Mall is at a walkable distance from the hotel Hotel offers a kid’s club and a concierge service. 9th Dec 2020 3630 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 3763 3763 3953 3791 3620 3763

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8.8/10

Millenium Hotel Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Khlong San, 10600 26 km 5.5 km 6.7 km

Source: TripAdvisor, Booking

Description: It is on the banks of the Chao Phraya River and provide rooms with the river and city view Grand Palace and the Wat Pho temple are some of the popular landmarks nearby Award winning hotel for Thailand’s best Business Hotel 9th Dec 2020 4717 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 6272 6272 6272 5213 6715 6715

rupees) Table showing rental rates of the hotel from December 9th to December 15 th

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9.2/10

Park Hyatt Location Distance from Suvarnabhumi Airport Bangkok Distance from Bangkok Railway Station Distance from MRT Station Facilities

Lumphini, 10330 23 km 4.3 km 3.1 km

Source: TripAdvisor, Booking

Description: Features the unobstructed view of the capital through the floor-to-ceiling windows Directly connected to Ploen Chit Skytrain station Popular nearby landmark includes the Lumphini park and Zantino Tailor 9th Dec 2020 12250 Rent (in

Date

10th Dec 11th Dec 12th Dec 13th Dec 14th Dec 15th Dec 2020 2020 2020 2020 2020 2020 12250 12250 12700 12250 12250 12250

rupees) Table showing rental rates of the hotel from December 9th to December 15th

8.5. ANALYSIS Comparison of rental price between Bangkok and Delhi

Average Rent for 3-Star for 7 days 4000 3500 3000

Rent

2500 2000 1500 1000 500 0 Bangkok

Delhi

City Figure 14 Comparison of 3-star Category

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Average Rent for 4-Star Hotel for 7 days 4000 3500 3000

Rent

2500

2000 1500 1000 500 0 Bangkok

Delhi

City Figure 15 Comparison of 4-star Category

Average Rent for 5-Star Hotel for 7 days 4000 3500

3000

Rent

2500 2000 1500 1000 500 0 Bangkok

Delhi

City Figure 16 Comparison of 5-star Category

From above analysis we can conclude that Delhi is much expensive in 3-Star and 4-Star category whereas, for 5-Star category Bangkok is having a upper hand. In terms of Amenities, Bangkok provides much facilities as comparison to Delhi. So, we can say that 7 days stay in Delhi would be much costlier with the less facilities provided whereas, in Bangkok 7 days stay would be cheaper with much number of facilities provided.

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9. SLO AND RICS COMPETENCIES ADDRESSED 9.1 RICS COMPETENCIES COVERED UNDER THIS COURSE ➢ Competency: Business planning – Mandatory – M006 ➢ Competency: Business Alignment – Technical – T011 Business planning is done to understand the business activities carried out by a company, its estimated goals /targets, and a simple policy to achieve the target. In business planning, market analysis and financial planning are crucial elements. Market analysis includes studying the trends prevalent in the markets, the customer choices and preferences, their demand for a specific goods and thereby the supply by the key players in the business. Financial planning includes analyzing the balance sheets, income statement etc. to understand the assets, liabilities of a company and its income and expenditure. Economics for built environment introduced us to the key concepts and considerations which are necessary to formulate a business strategy. It also made us realize the way in which individuals and economies manage their resources to make the most out of it. By studying this course and after doing the related assignments, we can surely say that we have become competent enough to understand the basics of business planning. This course taught us how various factors contribute to the growth or fall of markets like scarcity (lack of sufficient resources to suffice the needs of all), opportunity cost (a calculated sacrifice to be made in order to get something else), equilibrium (a point where both demand and supply have equal values), behavioural economics (how consumer’s decisions vary with respect to situations and trends), Willingness to pay ( maximum amount a buyer is willing to spend to buy a good/ service) etc. We also learnt the technique to plot the demand – supply and cost revenue graphs and learnt to read and analyse them. We also understood the concepts like price flooring and price ceiling which further lead to increase or decrease in demand. The concept of break-even point (the point where revenue and total cost meet) was introduced which further simplified the minimum quantity of goods to be sold to recover the investment made in a market. Cost function (the cost which is involved in the production of goods) and production function (the maximum quantity of output generated by introduction of a given number of resources) were other important concepts which we studied. The knowledge of alignment of business activities as per the global trends made us realize how they govern the local businesses and markets. The business activities and nature of its change are vital factors which need to be studied by the future managers. All these economics learnings are necessary for a budding real estate professional to make a mark in the industry and develop a good business strategy to reap the maximum benefits. The knowledge of this subject will be applicable in the real estate industry for job roles like business developer, management consultant, etc.

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9.2. STUDENTS LEARNING OUTCOME (SLO) 1. To recognize the basic economic rationale which guides the decisions in a business (M006) – We understood the logic which businessmen/ economists use to make successful business decision by considering different factors (like cost and profits, scarcity, supply, demand, incentive, etc.). 2. To recognize and understand the crucial economics parameters which guide the daily decisions of businesses and households (M006, T011) – For all day-to-day activities, we knowingly or unknowingly apply some economic ideas like economies of scale and scope, profit margin, cost – revenue, market strategies etc. We know these concepts but do not know the science behind it. So, we studied the course from this aspect. 3. Understanding the global and Indian economy in terms of its operations (T011) - We studied about how the economic activities of our nation and across globe are interdependent in nature and knowing / keeping track of these trends is a must. E.g. – Changes in oil prices may directly/ indirectly affect the real estate property prices considering the related intermediate transactions. 4. To understand the macro economy in respect to the requirements of a business activity (T011) – We learnt about the nature, behavioural pattern, efficiency, and performance of a business activity in terms of GDP, employment, inflation etc. and about the fact that business activities get impacted by market trends, government regulatory policies, financial risks, etc. 5. Inculcating and applying the economic terms, postulations, and ideas for evaluating the happenings in real estate sector and thereby resolving them (M006, T011) – We understood the application of economic concepts in transactions of built environment and the sectoral trends which govern them. E.g. – knowledge of demand and supply of residential asset class can help us to make a smart decision while doing a feasibility analysis on a land parcel. In real estate sector, having knowledge of regulatory acts assures success.

9.3. COURSE LEARNINGS THROUGH MODULES 9.3.1. Module I Introduction: (Student learning outcome (SLO) - 1, RICS competency - M006) Through this module we learnt the basic concepts which are used by economists in their daily lives. Being a future manager, it is highly recommended to have knowledge of these terms like cetpar, opportunity cost, resource allocation, externalities, law of diminishing marginal utility, law of diminishing marginal return, etc. Knowing these terms and applying them in businesses and industry will help us in our career and pave the way for success. As students, learning economics again after the school days was a great experience. we were introduced to some key terms economics terms so that we have in-depth knowledge about it. Basically, every student was asked to put forth their questions and their doubts were resolved through personal interaction in the class. The real-world examples and the experiences shared by Prof. Deva Dubey in the class were appropriate and insightful. Initially I was quite unsure about how I would be able to grasp the pure economics terms. But after attending the Economics lectures in week 1 and week 2, I felt that I can keep the pace and use them in my academics and research reports.

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9.3.2. Module II Key issues in Economics: (Student learning outcome (SLO) - 2,4; RICS competencies - M006, T011) In this module, we learnt about the key issues in economics most significantly the demand and supply concepts in real estate sector. The factors which decide the production/ launch of commodities is the gap between demand and supply. When the demand and supply for a good is equal we say that it is in equilibrium position where the demand of each consumer is successfully met without any excess resource utilization. This is an ideal state which everyone strives for in case of excess demand or excess supply the market tries to reach an equilibrium point. In a market, if there is a huge demand for a type of property and the demand is limited in that case the prices for that property will increase as the people are ready to spend more. Substitution effect and income effect are major factors responsible for this increased demand. This will lead to scarcity and inflation as not all the consumers are able to afford it. This is the time when government comes into picture to regulate the price of the same type of property, so that it becomes affordable for all by setting a price cap – price ceiling (The maximum price that can be demanded from a customer). E.g., Government set the price cap for airlines during COVID19. On the contrary if the demand is less and supply is more, then there is a surplus of goods/ services in the market and thus the prices of the commodities fall considerably. This again necessitates the government to intervene and set a price cap – Price flooring (The minimum price at which a good can be sold in a market). E.g. - In real estate sector, government set circle rates (the minimum price in an area below which a property transaction cannot take place) to ensure there is a uniform development across all the regions in district/ state. In real estate sector developers come up with new launch of projects based on the demand and feasibility analysis. If the demand for commercial asset class is more in some area and if the developers come up with residential asset class (when there is not much demand for it) then the inventory will be vacant and lying for significant amount of time. So, it is of utmost importance to have knowledge of market trends and demand-supply gap to be successful in long run. 9.3.3. Module III Firms, Markets and Governments: (Student learning outcome (SLO) – 1,2,4 and 5; RICS competencies - M006, T011) This module deals with the economic agents in the built environment (clients and contractors) which drive this sector, the market mechanism and government intervention and policies. The concepts of production function (mathematical function that derives the maximum possible output from a given quantity of inputs) and cost function (cost associated with the production of goods/services) were introduced. Land, capital, labour, entrepreneurship, and technology play a crucial role in influencing production while wages and rents to be paid, other costs etc. influence cost function. The concept of economies of scale which is practiced by many real estate companies which try to do many activities in-house which helps them produce more and make more profit and at the same time they also practice economies of scope where they can produce variety of projects ranging from different asset class with the help of same in-house departments by distributing their resources cleverly to maximize profit. The knowledge of investment i.e., total cost in the form of fixed cost and variable cost, revenue and the revenue generated in a business are very vital. The Breakeven point (point at which the

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total cost and revenue meet) is very important when you are doing a business. Anything above the BEP is beneficial in a business as you start making profit beyond this point (on the right side of BEP). The more quickly a business is able to achieve the BEP by selling its products, the more easily it is able to recover it’s investment. Higher the value of BEP make the business shaky as it has to induce more efforts to reach the BEP. This module also introduced certain concepts of the markets mentioned above. The terms introduced were market failure (unequal distribution of resources amongst the different sectors of the society and differences in demands and supply), externalities – positive (when one gets benefited by the actions of another) and negative (when one person gets harmed by actions of another) which calls for government intervention to handle these externalities. Free rider and positive externalities are similar concepts. Also, the concept of information asymmetry was introduced which states that during a transaction one group from the transaction has more information than the other which leads to differences. 9.3.4. Module IV Macroeconomics: (Student learning outcome (SLO) – 1,2,3,4 and 5; RICS competencies - M006, T011) This module deals with macroeconomies (a bigger level study which deals with the decisions taken by governments and economies) and the contributing concepts like circular flow (where government, firms/companies and households are inter-related with each contributing to the growth of economy making it stable), outputs (of economies in the form of its production), employment, prices, economic growth etc. The other concept introduced were - Gross domestic product (GDP), nominal GDP, aggregate GDP etc. which are the guiding factors for an economy to perform well by striving to produce more with the help of available resources without putting tension on them and skillfully making profits. Again, the four factors of production find their way here. Also, the international policies, Indian policies were discussed. Real estate regulatory and development act (RERA) was also discussed along with Real estate Investment Trusts (REITs).

9.4. LEARNINGS FROM THE PSDA AND GROUP ASSIGNMENT The PSDA and group assignment were designed in such a way that we inherit the RICS competencies of ‘Business alignment’ and ‘Business planning’. We posed as a consultancy group which would advise the approaching clients, the most reliable strategy to price their property, i.e., hotels in New Delhi. We collected the data of room rentals of 25 hotels for specific week in the month of December and documented the facilities it provided to its customers. Also, the location characteristics were noted down like proximity to landmarks, station, substation, airport etc. This assignment focused on finding out the room rentals by running a regression model and further analysing it in the form of hedonic pricing method where different attributes contributing to the pricing were analysed critically. The group assignment also required us to analyse the hotel pricing strategies for an international city and examine the attributes prevalent there-in which have had an impact on the pricing. Both the activities made us apply our economic acumen which we have achieved through the course, for coming up with the most appropriate strategy.

9.5. SELF WORK (SW) Self work assignments were like the preparatory assignment for the final PSDA. There were total 5 Self work assignments.

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9.5.1. SW 1, 3 These two SWs focused more upon understanding the research papers based on ‘Hedonic Pricing’ and understanding concept. Writing detailed analysis and review of four research papers made us ready to know the concept of regression model and factors contributing to the price of built environment. We realized that human beings are trying to maximize profit or minimize cost and thereby make property choices which are governed by the factors like availability of lakes, gardens, natural setting, retail centers etc. The first SW also asked for writing about the economists which students admired in real life and the learnings from them. 9.5.2. SW 2 This assignment was focused upon mapping and poster making. The mapping part was done on Google my maps. The mapping task was amazing where we could understand the locations of residences of the students and also map them. Knowing this mapping skill was very useful for the mapping of the hotels in the PSDA part of the assignment. The precise location of the residences with all its details could be plotted on the map. We made economic poster with any 10 key terms learnt in that week. So, from then we started using the terms learnt in the course in our daily lives. 9.5.3. SW 4 This assignment was based upon application of learnings from Module II, especially on demand and supply, through the numerical based on arc elasticity and price elasticity. We also plotted the demand curve and supply curve to understand how it varied with the given quantity and price of the products. It was a great learning outcome when analyzing the graphs and evaluating the quantities and graph curves. We also started working on the PSDA assignment by finding data of one hotel from the selected city. We as a group had selected our city as New Delhi. 9.5.4. SW 5 In this assignment we again plotted the demand supply curves but this time along with the Equilibrium point. The positive curve of supply and negative curve of demand was plotted manually as well as on graph. We learnt the plotting part as well as deriving equation of the two curves from this assignment. By substituting values of price and quantity we could derive the equilibrium point as well as the intermediate values as per our choice. We also calculated the BEP and BEPCU values for the given question thus understanding the minimum quantity of goods to be produces to start making profit.

9.6. CLASS ACTIVITY Conducting class activities was one of the methods adopted during the course tenure to make the learning process more interactive. The students were given an opportunity to present their selected products/ goods to the class and thereafter opinions of the class were recorded. The class activities were like economics experiments to record the opinions of the class, evaluate and then analyse the same to derive to the conclusion. The class activities conducted during the course were as following -

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9.6.1. Demand Analysis A group of four students took the initiative and posed themselves as an ear dope sales team. They introduced their product – ear dope to the class and explained its features and cost. The range of the cost varied from ₨1399 - ₨1799. The presenters then tried asking to the class, the cost at which they would be interested to buy the ear dope. So, the audience was requested to bid for any one price in the given range and their responses were recorded. The findings were then plotted against demand curve. Conclusion An attempt was made to understand how the preferences of the audience varied for the same product and the price at which they were willing to buy the ear dope. Most of the students from the audience were willing to pay the lowest price for the ear dopes. They were trying to maximize their profit by spending less amount to buy it. At a given point in time, masses generally try to minimize their cost by buying a product at the lowest possible price. So, the demand curve is negative, whereas the price decreases, the number of buyers buying a product increases. Thus, we can say, the quantity and price for a demand curve are inversely proportional (everything else at cetpar) 𝟏

𝑸 ∝ (𝑷)….....(Where Q – Quantity and P – Price) 9.6.3. Supply analysis A group of 6 students (including me) from the class posed as government officials from Brihanmumbai Municipal Corporation. These students conducted a tendering process for CCTV camera which were planned to be installed on the main road from Bandra to Marine Drive. The audience was requested to bid for the quantity which they were interested to supply to BMC. The supply quantity from the audience at the specified range of price (₨6000 - ₨14000) was recorded. The responses from the audience posed as suppliers was plotted on supply curve. Conclusion The audience who posed as the suppliers in the tender process supplied CCTV cameras a different price as per their capacity to supply. Some suppliers provided less quantity of CCTV cameras at lower rate of CCTV while others supplied more quantity of CCTV at a larger price. It was observed that at lower price the suppliers could supply a limited or lower number of CCTV cameras but as the price went on increasing, the scope for supply of the product went on increasing. Thus, a positive slope of supply curve was observed when plotted as the quantity and cost of the CCTV Camera supplied. Thus, we can say, the quantity and price for a supply curve are directly proportional in nature (everything else at cetpar)

𝑸 ∝ 𝑷….....(Where Q – Quantity and P – Price) 9.6.5. Cost revenue curve This activity was conducted by the same 6 students (including me) from the previous activity. This time they formed 3 pair and posed as business owners. Three different levels of business models (Economies of Scale) were proposed for the same commodity i.e., white T-Shirt. The first pair were roadside vendors who had made limited investment in the business in the form of display tables, umbrella, stools, electric connection, battery. Their fixed cost was less and had minimum investment. The second pair had a shop in mid-scale commercial complex and had done investment in the form of shop interiors and on display area. The third pair had a large showroom in a mall with all the modern amenities and had invested a lot on customers ambience. Their fixed

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cost was high when compared to the other two pairs. The values of the fixed cost, variable cost (price of T-shirt) and revenue factor (varied for all the three models) and revenue generated were plotted on cost-revenue graph (quantity vs price). Conclusion After plotting values of all the three scenarios it was seen observed that as the revenue factor for the three scenarios increased above 1, the BEP shifted towards left. This denoted that it became more of ease for the pairs to make profits after covering their initial investments. It was also observed that as the fixed cost for the business increased the quantity of goods to be sold out to achieve the BEP increased. But the last business model with the high investment, was in a position to sell at a higher revenue factor/ profit margin when compared to the first pair. Thus, for any business model, achieving BEP quickly should be the target.

9.7. E- LEARNING CONTENT The E-learning content - presentations and case studies are very helpful. The math refresher content is helpful for understanding the basic math and plotting the data (univariate, bivariate and multi – variate) on graphs in the form of lines. This E-content also taught the techniques to derive the equations of the curves/ lines which we plot on the graph. This was like refresher content of the learnings from school but this time applying it to the economic concepts. The demand – supply case studies made us understand the application of concepts of scarcity, surplus etc. through changes in scenarios. As per the problem statement the curves shifted right or left thus denoting a shift in its position and thereby the equilibrium point. The market trends and mentality of people during the economic issues were an insightful engagement. The other E-content on behavioural economics introduced us to altogether new concept of economics where study of different fields like biology, anthropology, sociology, and psychology is applied. We understood that Behavioural economics deals with why and how people behave in a specific manner and how the market trends can have an impact on the thinking and behavioural ability of masses.

9.8. YAMMER Yammer is like social media platform for sbeians. This is a learning platform where anyone can post informative articles. There are ample of articles related to economic activities prevalent in India and across the globe. Reading these articles has made us aware of the activities happening in the markets.

9.9. GLOSSARY For understanding any subject, the basic terminology should be understood and used on day-today level. I think this was made possible through the amazing glossary section on LMS. All the students get this opportunity to contribute to the glossary section. We added some economic terms too. The glossary section has many informative terms. I have also started using these terms and relating them to my daily activities. I have started using cetpar (when comparing things, given that all the variables except one variable are constant), circle of blame (when people are not ready to take the responsibility of their mistake, free rider (when someone from the group doesn’t work at all and relaxes in a group project), diminishing marginal utility (while writing a lot for a PSDA activity even after the requirements are met), Economies of scale (when all the members in a group are contributing whole heartedly for a given activity against only 1-2 members working on

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the behalf of the group and producing incomplete work even after working hard) etc. It’s fun to use this new economics language.

9.10. MID TERM OPEN BOOK EXAM Appearing for the midterm exam was a great experience where we were able to apply our learnt economics concepts. For the first we were having an open book exam which demanded clarity of economic concepts. The scenario-based question required application of critical and analytical skills along with time management. The questions were based on market analysis (deriving demand supply equations and plotting them), supplier behavioural and decision making (finding the BEP, BEPCU and its analysis), regulatory action and behavioral economics (Evaluating the change in the market situation due to price cap, i.e., price ceiling and analyzing the behaviour of managers and customers).

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ANNEXURE The link for excel sheet reflecting all the hotel details is: https://1drv.ms/x/s!AiGqWoLXSghGhEEs5rLt878_chLK

REFERENCES Agmapisarn, C., 2013. A Hedonic Pricing Analysis of Hotel Prices in Bangkok Using a Flexible Functional Form. Economics and Public Policy Journal, 4(8), pp.21-36. Hotel booking Websites: Tripadvisor.com Booking.Com Trivago.in Goibibo.com RICS Competencies: Available on www.rics.org