For Shruti Shibulal, the 33-yearold CEO of hospitality venture Tamara Leisure Experiences, sustainability has been the cornerstone of how things are done across her hotel properties, whether it be financial, social or environmental. “Profit, people and the planet,” she puts it pithily. The daughter of Infosys co-founder S.D. Shibulal cites Tamara Coorg, the chain’s first luxury resort launched in 2012, to prove her point. Tamara Coorg, spread across 180 acres of coffee plantation in the Western Ghats in Karnataka, broke even in just three years; 60% of the employees are locals; and the construction of the cottages was done with minimum dent to the environment.
“Our ethos from the very beginning has been ‘sustainable good life’ ... We wanted to provide unique authentic guest experiences with sustainability built into it,” Shruti says. Things are looking lively at Tamara Leisure Experiences. In May, it opened its second luxury property, Tamara Kodai, in Kodaikanal, Tamil Nadu. The 53-suite heritage resort boasts La Providence, a building that dates back to colonial times, now restored to serve as an all-time diner. The company is developing two new properties in Kerala and renovating an existing one: a business hotel with 154 rooms in Thiruvana nthapuram which is expected to open by this year end; a hotel in Guruvayur for which it has procured land; and it is sprucing up and adding more rooms in its luxury resort Palma Laguna in Alappuzha. Shruti is also eyeing local acquisitions to expand the company’s midsegment serviced apartment brand, Lilac, in Bengaluru in Karnataka. Besides these, it owns three properties in Germany, which are leased out: Holiday Inn Express in Guetersloh, Prizeotel in Hannover, and Courtyard by Marriott, in Wolfsberg.
In an interview with Fortune India, Shruti talks about blending sustainability and business, and why it makes economic sense in the long run. Edited excerpts:
How do you define ‘act on sustainability’?
The way I look at sustainability is from three perspectives: financial sustainability, social sustainability, and environmental sustainability—profit, people, and the planet. All of them have to fit together to create a business, otherwise the business will not survive. If you don’t have financial sustainability, then you are not going to have a high-performing, long-lasting organisation. The other two (social and environmental) are also becoming more and more relevant to all businesses. Our ethos from the very beginning has been ‘sustainable good life’—which essentially meant that we wanted to provide unique authentic guest experiences with this whole concept of sustainability built into it. I don’t see business and sustainability as two parts—two different exclusive things that you concentrate on.
How have you managed to imbibe and implement sustainable thinking within your organisation?
As developer-operators, we have the advantage, and the responsibility, of being able to think through the entire lifetime of a project. This holistic perspective, I believe, is very important. With Tamara Coorg, for instance, we had to manage a luxury build on a sprawling coffee plantation packed with dense vegetation and forests. We couldn’t just bulldoze our way in and make a detrimental impact on the environment. Integration into the local landscape was the way to go. So, from the design aspect, we tried to create a minimal footprint on the ground as we possibly could—all our cottages are on stilts with all the vegetation left as it is. We chose not to build cottages in areas that would result in too much destruction to the area around. All uprooted trees were replanted—essential since these prevent landslides. We build our properties to last for years to come.
How does Tamara practise social sustainability?
I think it is important for us to give back to the communities and spaces we are in—so they are included and feel proud of what has been created there. That is the social aspect of sustainability for us—a key point, and we made a conscious effort to include it in our plans. It’s not difficult to achieve—it is just the mindfulness that is required throughout to make sure that it happens. Once you commit, this sustainability is built into your targets, goals, and vision. In Coorg, for instance, 60% of our employees are local. We make sure the economy is contributed back to.
Are there any more measures that have been easily adopted by others?
Our Coorg property has been operational for six years now. As we have grown the property, we try and keep innovating. In sustainability terms, we focussed on energy, water, and waste. One of the things that we did to reduce water consumption is to fit tap aerators [a small device which controls water flow through the tap without affecting the water pressure] which are cheap [about Rs 10 apiece] and easily available. This simple measure has reduced our water consumption at the property by 30%. If you invest a bit extra in capex, it can reduce your operational costs significantly and recover that cost in a relatively short period of time. We also keep track of food waste on a daily basis and arrive at a monthly average and compare it with our monthly target for reducing wastage. We keep a tab on kitchen practices [amount of food being prepared vs. daily consumption]. If your guests are not having large portions, why cook that much? By implementing such simple measures, we were able to bring down food wastage by 15%. I have heard of these practices being followed in IT companies. They were doing it in their cafeterias. Simple things like motion sensor lights in hallways and backyards make a big difference as well.
What about other projects?
In the Thiruvananthapuram property, we measured and analysed how big the windows should be for optimal amount of natural light and a good view. We put in a kind of glass that is slightly more expensive than normal glass. It allows more light and has less heat absorption which lowers the AC usage in rooms. This is mostly done in that property specifically because it’s a glass tower structure.
Cost-wise, does it make much of a difference when you implement long-term sustainability measures?
Once you start operating things, it doesn’t make much of a difference because your operational costs come down so much. Energy is expensive, water is expensive, and nowadays, we have to think about buying tanker water for consumption because we do not have water in most cities. When you are running a hotel, you have to have power and water 24x7. You can’t afford to affect the guests’ experience because of city issues.
It is a perception that sustainability comes at a premium. Are customers willing to pay that price?
I don’t think a customer comes to you because you are sustainable or not… I think it matters to some. However, today more people care and they appreciate that you have made such efforts... But whatever we do, if the quality of that experience or the functionality of that product is not there, then there is no customer. At the end of the day, it is literally about the service and the experience. I honestly don’t think a sustainability project is that much more expensive. We have seen it. I apply the principles in Lilac [in Bengaluru] which I apply in Tamara Kodai, and they are not highly expensive. For example, for plumbing, we take recycled water, we treat the water and make sure that the treated water goes into landscaping and flushing toilets. That could be done in any place in any building… it doesn’t matter if you are a luxury property or mid-segment hotel.
Do you think the hospitality sector in India has managed to make sustainability a core part of its business considerations?
I think the advantage that we have is that we are developers and operators. It makes a difference, and typically that’s not the case… Typically, you have somebody building it and someone else operating it. I think traditionally, hospitality is a very wasteful industry with not that much concern towards this [sustainability]. But that has changed and there are quite a few brands who are really concerned about it and doing some good work.
How is the overall business shaping up?
We have over 600 rooms today [including resorts, hotels, and serviced apartments in South India and Germany], and an employee strength of about 290. By year end, we should be closer to around 800 rooms. We are on track to reach 1,000 rooms by 2025. At present, we are looking at acquisitions— owning and operating our own properties. Revenue takes time to unlock, especially with luxury ventures, and when you build your own properties. Profitability depends on the property. Tamara Coorg was operationally break-even years ago. Lilac in Bengaluru was break-even from the second or third month after its launch. A larger property could take about three to five years to break even.
(The article was originally published in July 2018 issue of the magazine.)