Dubai’s hospitality sector is all set to grow further this year with an increased average daily rate and revenue per available room despite the low occupancy rate and increased supply compared to the pre-pandemic era.
The hotels across the emirate are expected to hit 80 per cent occupancy rate this year with a steady increase in the average daily rate and revenue per available room as tourism is back on track, according to the Zoom Property Insights.
The Insights data indicates that international visitors to Dubai are expected to exceed the pre-pandemic period in 2023 which will benefit the hospitality industry. The emirate achieved 73 per cent hotel occupancy after welcoming 14.36 million international visitors last year, Dubai’s Department of Economy and Tourism data disclosed.
Ata Shobeiry, CEO of Zoom Property, believes that the hospitality sector will continue its upward trajectory this year after a strong performance in 2022.
“While the occupancy level was two per cent below 2019, pre-pandemic era, the high ADR and RevPAR demonstrate a strong position of the sector. ADR showed a growth of nearly 34 per cent, while RevPAR also made a jump of a little over 31 per cent. I believe 2023 will follow suit and record even high figures as Dubai continues to attract tourists from across the globe.”
Data obtained from STR shows that December 2022 saw 76.6 per cent occupancy with Dh892.84 as the average daily rate and Dh684.03 as revenue per available room.
A further breakdown shows that the Dubai hospitality sector produced the best figures on New Year’s Eve as the occupancy reached 91 per cent, while ADR and RevPAR amounted to Dh1,765.51 and Dh1,606.74, respectively.
New supply of rooms
According to the Zoom Property Insights, the UAE hospitality sector will see 48,000 new rooms by 2030, aiming for an expansion of 25 per cent, to cater to the growing number of tourists.
The Zoom Property Insights further revealed that Dubai, being a prominent destination, will receive the maximum share (76 per cent) out of this inventory. The noteworthy point here is that Dubai already has a higher portfolio when it comes to the number of rooms as compared to other advanced metropolises, such as London and New York.
“The strategic location of the emirate, presence of globally-renowned corporate organisations, and world-class attractions are some of the major factors that are contributing to the growth of the hospitality sector. With more international operators venturing into the market, it’s set to witness more growth in the time to come”, Shobeiry concluded.
• With 76.6 per cent occupancy, Dubai hospitality recorded Dh892.84 as the average daily rate (ADR) and Dh684.03 as revenue per available room (RevPAR) in December 2022.
• Occupancy level reached 91 per cent on New Year’s Eve, while ADR and RevPAR amounted to Dh1,765.51 and Dh1,606.74, respectively.
• UAE hospitality sector to see 48,000 new rooms by 2030, with Dubai receiving 76 per cent of the total supply.
• Dubai hotels may see more than 80 per cent occupancy rate as tourism is back on track
Once ramped up, the new centres are expected to each generate annual revenue of up to Dh200 million
Many residents opt for it in times of financial crunch and other urgent personal needs
Rents are projected to continue the upward trend across the country in 2024
The number of transactions carried out witnessed a significant increase compared to last year
The 57,000 sqm facility incorporates advanced technologies that include automated sort systems
Report notes that the GCC banking sector has experienced steady growth due to infrastructure projects, economic diversification efforts