Paying guest (PG) accommodation in Bengaluru may see rents rise by at least 5% if inflation and geopolitical uncertainties continue to push up the cost of essential supplies, particularly cooking gas, according to PG operators in the city. They say they are already facing shortages of commercial LPG cylinders, forcing them to make operational adjustments, including cutting back on food items such as dosa and idli that are traditionally served to residents.
“PG rentals may increase if the current geopolitical uncertainty continues and input costs rise. However, any increase is likely to be gradual and will depend on how long the LPG supply disruption caused by global conflicts persists,” Sukhi Seo, secretary of the Bengaluru PG Owners’ Association, told Hindustan Times Real Estate.
According to PG owners in the city, the sharp increase in cooking gas prices and supply constraints have made it difficult to maintain the usual food menu offered to tenants. “Many operators have temporarily stopped preparing breakfast items such as dosa and idli because they require higher quantities of LPG and longer cooking time. Several PGs have already run out of commercial gas cylinders. As a result, many have reduced food preparation and are relying mainly on simpler meals such as rice and sambar,” Seo said.
PG accommodations are a major housing option for students and young professionals in Bengaluru’s IT corridors, particularly in areas such as Whitefield, Electronic City, and Marathahalli. Operators say rising input costs, from food ingredients to energy and labour, are putting pressure on their margins.
Seo pointed out that while they are trying to avoid immediate rent increases to retain tenants, sustained cost pressures could eventually lead to higher accommodation charges across several parts of the city.
Rentals in Bengaluru PGs today
According to data from the Bengaluru PG Owners’ Association, Bengaluru had around 12,000 PG accommodations before the pandemic. Still, the number has since fallen to about 10,000 after COVID-19, as several operators shut down during the lockdown. Of these, roughly 3,000 PGs are legally registered, while the rest continue to operate in the unorganised segment.
In prime localities such as Whitefield and Koramangala, the average rent for a three-sharing PG room typically ranges between ₹9,000 and ₹10,000 per person, Seo said. Twin-sharing rooms are usually priced slightly higher, while single-occupancy rooms often cost more than ₹15,000 per month, depending on the facilities and location.
Why Bengaluru PGs are vulnerable to the LPG crisis
According to PC Rao, president of the Bengaluru Hotel Association, food services for PG accommodations in Bengaluru are often supported through tie-ups with nearby eateries and small hotels.
“More than 1,000 hotels and small restaurants across the city supply meals to PG accommodation through contractual arrangements,” Rao said. Under these arrangements, hotels prepare the food and deliver it to PG properties daily, allowing operators to provide meal services without maintaining full-fledged kitchens on the premises.
However, not all PGs rely on external vendors. Seo noted that some larger PG establishments maintain their own kitchens equipped with gas connections and cooking facilities, where food is prepared in-house for residents. These in-house kitchens are typically found in bigger properties that house a large number of occupants and can manage dedicated cooking staff.
Thus, experts say the ongoing LPG supply disruption could pose operational challenges for many PG accommodations in the city. Since several PGs either run in-house kitchens using LPG or depend on nearby hotels and eateries that use gas for cooking, any shortage could affect the regular preparation and delivery of meals to residents, they said.
“Today, it is easier to explain to tenants that the situation is tough. Once normalcy returns, rents may have to come down again, it will become difficult to sustain for them,” Seo said.
