Bengaluru PGs witness a 25% loss after layoffs in the IT sector, new rules, higher water, and electricity bills

Paying Guest (PG) homes in Bengaluru have been facing losses of about 25 per cent because of a series of job layoffs in the tech industry, new regulations, and higher water and electricity bills, as reported by  Deccan Herald.

Reasons why PGs in Bengaluru are shuitting down

According to the report, PGs in the tech hub have closed down in the last year, and many more are struggling to stay open.

At least two PGs in every area of Bengaluru have shut down, and many more are struggling to stay open.

Sukhi Seo, secretary of the Bengaluru PG owners’ association, told Deccan Herald that with a surge in water and electricity rates, it's difficult to run the business at a price guests can afford.

“Many of our guests are students. We do not want to burden them with higher rents. But the increasing costs and changes to be made to abide by norms laid out by the civic body are only burning a hole in our pocket. It is difficult to keep the business running with such losses,” Sukhi said.

Reportedly, the PG owners have been losing about 25 per cent of their income, and the number of paying guest homes shutting down is much higher in places like Marathahalli and Sarjapur, which see more footfall from professionals employed in the IT sector.

Aruna Kumar DT, president of the PG Owners Welfare Association, told Deccan Herald that, “Only those who run multiple branches are managing to run them. Even those staying afloat are seeing a dip in the number of guests and have reported a loss of 20-25 per cent.”

Incidentally, both the BBMP and the Bengaluru Police have been keeping close tabs on paying guest homes after a murder took place inside such an establishment last August.

PG owners are also under pressure from the Bruhat Bengaluru Mahanagara Palike (BBMP) for flouting rules.

Rules focusing on safety and cleanliness, including one that stated that PGs should not be run in residential areas where the road is less than 40 feet wide, led to the shutdown of about 100 PGs in Mahadevapura.

Also read: ‘This game is rigged’: Indian-origin Berkeley grad claims he created fake founder persona & tricked 27 VCs (startuppedia.in)