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Pandemic fallout: Tenants working from home, many PGs in Gurgaon stare at closure

"All PGs in the city are facing these issues, and around 50% have already closed. If companies do not open, another 30-40% will have to shut shop… Only those who have their own buildings will survive, those who are renting buildings cannot manage," he said.

Written by Sakshi Dayal | New Delhi | Updated: October 27, 2020 5:41:07 pm
Several PG owners have reduced rent and deposit. (Archive)

With most organisations in Gurgaon adopting a work from home policy since March, due to the pandemic, paying guest accommodations in the city are continuing to reel under the impact of the mass exodus of employees back to their hometowns. While several PG owners have reduced rent and deposits, others have closed down or are on the verge of doing so.

“We have reduced rent and deposit at our PG. Charges for double sharing have reduced from Rs 7,500-8,500 to Rs 6,000-6,500, for triple sharing from Rs 6,000-6,500 to Rs 4,500-5,000, and for single rooms from Rs 12,000-14,000 to Rs 9,000-10,000,” said the owner of a PG in DLF Phase 3, who did not want to be named. “We have also reduced the deposit by 50%. Earlier, we used to charge two months’ rent as deposit, this has now reduced to one month,” he said.

Pankaj Chandna, who owns a PG in Sector 31, which houses “mostly IT companies’ employees”, said he has also adopted this strategy of reducing charges in the hope of attracting tenants, but to no avail. “We have 15-20 beds, of which only one or two are filled. The landlord from who we have rented the building to run the accommodation has been adjusting so far but we are now thinking of just shutting down altogether. There is nobody coming to see the PG also. We are waiting till Diwali, if nothing changes, we will shut down,” said Chandna.

“All PGs in the city are facing these issues, and around 50% have already closed. If companies do not open, another 30-40% will have to shut shop… Only those who have their own buildings will survive, those who are renting buildings cannot manage,” he said.

Among those who have closed PGs is Mahipal Dabad, who had rented two buildings in Sector 31 that housed MNC employees. “We had to let them both go around two months ago as the owner wanted the full rent and there was no way we could pay it. There was also no point in incurring costs of staff, electricity and maintenance, when the situation was unlikely to change anytime soon,” he said.

Office bearers of the Millennium City Guest House Association, an umbrella body of PGs and guesthouses in Gurgaon, said this situation is reflected across the “accommodation industry” of the city.

“The accommodation market as such in Gurgaon is suffering hugely with most companies working from home and likely to continue this up to March or July next year. Since most of the Fortune 500 companies are in Gurgaon, and a lot of the people who work in these from all over the country have returned to their hometowns, I would estimate around 80% of the PGs in Gurgaon are currently shut. There is just no demand and I don’t see any respite until offices resume full work from office, even if prices are slashed,” said association president Jaideep Ahuja.

“Guest houses are also mostly shut as bulk of the business is due to corporate travel which is close to zero right now. There were some that were dependent on medical tourism but since most people are not coming to India for elective surgeries in the Covid scenario, these places are also suffering. For the hospitality industry, PG industry, co-living industry, this is probably the worst time anyone has seen,” he said.

 

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