UAE hotels bounce back with surge in occupancy

The UAE hospitality sector staged a strong bounce-back in the first quarter with hotel occupancy rates across the country hitting 63 per cent, underscoring the remarkable success of the nation’s Covid-19 vaccine drive.

The country’s fast rebounding hospitality sector, which stood out as the world’s second busiest after China in 2020, posted in Q1 a 27.6 per cent jump in average length of stay in hotels to 4.3 nights compared to the same period last year, initial data released by the tourism authorities revealed.

March recorded a growth of 34 per cent in the number of hotel guests compared to the same 2020 month.

While UAE nationals accounted for 25.6 per cent of the total one million guests, Dubai remained their preferred destination, followed by Abu Dhabi, Ras Al Khaimah, Fujairah and Sharjah.

“The UAE continues to enhance its coveted position on the global tourism scene, with domestic tourism now proving to be a significant catalyst for economic growth and a key contributor to GDP in implementation of the directives of the UAE’s wise leadership,” said Dr. Ahmad Belhoul Al Falasi, Minister of State for Entrepreneurship and SMEs, who is also the Chairman of the Emirates Tourism Council.

In 2020, the hospitality sector contributed Dh41 billion to the national economy – a figure that is expected to double over the next few years, according to the Ministry of Economy.

March in particular was most remarkable for the hospitality sector with a record 112 per cent growth in the Emirati hotel guests as compared to the same month 2020. The trend is a resounding testament to the fast-paced recovery from the pandemic the country has been achieving on the back of one of the most efficient vaccination programmes in the world, hospitality industry experts said.

Dubai, one of the most-preferred destinations for global tourists, is optimistic about the industry’s outlook this year on the back of an expected jump in visitor traffic for Dubai World Expo, the UAE’s 50-year celebrations, and a surge in domestic tourists.

“As we build on the strong rebound in 2020 and as confidence continues to grow within the industry and among travellers and with vaccinations being rolled out around the world, we expect to see momentum accelerating throughout 2021,” Issam Kazim, chief executive of Dubai Tourism, has said.

This year, Dubai aims to tap into the conferences business, boost leisure events and start a new global marketing campaign to showcase the emirate as a summer destination for families.

Abu Dhabi expects its hotel occupancy rates to increase to at least 80 per cent this year, from 70 per cent in 2020, according to Saood Abdulaziz Mohamed Al Hosani, undersecretary of the Department of Culture and Tourism Abu Dhabi,

He said Abu Dhabi has been taking extraordinary efforts to ensure public safety as it sought to further ease travel restrictions for international tourists.

Hospitality industry experts said the exceptional first quarter rebound was also due to government efforts encouraging domestic tourism and enact measures to accelerate the sector’s recovery. The trend is expected to accelerate going forward, given the efficacy of the Covid-19 vaccine push and easing of travel restrictions in some markets, they said.

In 2020, the UAE hosted 14.8 million guests who spent an average of 3.7 nights at 1,089 establishments to set an occupancy rate of 54.7 per cent. With this feat, the UAE outpaced the global average occupancy rate of 37 per cent and the Middle East’s 43 per cent, according to data from the World Tourism Organisation and the Emirates Tourism Council.

Coming first globally, Chinese hotels grabbed top spot in 2020 with an occupancy rate of 58 per cent while the US was third at 37 per cent.

According to STR Global, the UAE’s hotel occupancy rate rose to 62 per cent in March, up from 59.5 per cent in February.

“Although 2020 was a difficult year, the market ended the year with an occupancy above 50 per cent, which was a fine job in moving the occupancy line in the right direction. This trend has continued through the first quarter of the year,” Philip Wooller, area director for the Middle East and Africa at STR, said.

In March, each of the three main hotel performance metrics was up from the previous month. Revenue per available room, a key performance measure calculated by multiplying a hotel’s average daily room rate by its occupancy rate, jumped 77.1 per cent to Dh298.7 in March compared to March 2020 when the UAE closed its borders due to the Covid-19 pandemic. — issacjohn@khaleejtimes.com