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Mena hotels record surge in Aug occupancy levels

Hotel occupancy in the Middle East and Africa region increased 11.9 per cent to 53.8 per cent during August, while the average daily rate, or ADR, climbed three per cent to $154.93, and revenue per available room, or RevPAR, grew by 15.3 per cent to $83.37.

“The holy month of Ramadan ended earlier this August compared to August 2011, and performance metrics were positively impacted because of it, showing a 19.6 per cent RevPAR increase across the Middle East”, said Elizabeth Randall Winkle, managing director of STR Global.

“Africa’s RevPAR grew 5.4 per cent as occupancy continued to recover, but average room rates [in US dollars] remained under pressure,” data compiled by STR Global show.

ADR in Dubai increased 23.7 per cent to $184.23, posting the largest jump in that metric, followed by Jeddah, up 18.1 per cent at $255.99, and Amman, up 17.8 per cent at $160.

Cairo reported the largest occupancy increase, up 69.7 per cent to 37.9 per cent, followed by Amman, with a 52.9 per cent increase to 43.2 per cent.

Occupancy level in Riyadh fell 8.5 per cent in occupancy to 31 per cent, reporting the largest decrease in that metric.

Six markets achieved RevPAR increases of more than 25 per cent. These include Amman, up 80.1 per cent at $69.10; Cairo, up 66.4 per cent at $39.81; Dubai, up 59.9 per cent at $109.29; Jeddah, up 40.6 per cent at $202.75; Muscat, up 36.1 per cent at $61.27; and Manama, up 25.8 per cent at $67.08.

Beirut RevPAR fell 4.9 per cent to $68.41, posting the largest decrease in that metric.

According to the latest HotStats survey of full-service hotels in six Mena cities by TRI Hospitality Consulting, Jeddah hotels made a windfall profit this summer while other markets felt the heat.

Hotels in Jeddah posted 30.9 per cent growth in profits in July this year while the effect of summer and Ramadan impacted hotel performance levels in all other markets surveyed, HotStats survey reveals.

In the UAE, hotel performance levels for Dubai and Abu Dhabi in July highlighted the double impact of summer and Ramadan.

Average occupancy level at Dubai hotels in the first seven months was 82.3 per cent, the region’s highest. In Abu Dhabi, it was 67.8 per cent during the same period.

Occupancy levels in Dubai fell 11 percentage points to 70 per cent in July while average room rate, or ARR, increased by 6.4 per cent to $188.51. Additionally, the onset of Ramadan caused a notable decrease in food and beverage revenues as well.

HotStats survey shows that Abu Dhabi continued to demonstrate a decline in performance with a reduction in all performance indicators. Occupancy dropped 4.5 per centage points to 57.1 per cent while ARR dropped 8.4 per cent to $104.95 causing a 15.1 per cent drop in RevPAR during the month.

“As in the other GCC markets, Abu Dhabi too saw a considerable decline in food and beverage revenues last month due to the restrictions on sale and consumption of food and alcohol during Ramadan,” it said.

“Our HotStats data for Dubai and Abu Dhabi highlights the effect of the culmination of the low seasons as we saw Ramadan, which is a traditional low demand period, moving into the peak summer period last month. Although performance levels are expected to improve in both cities after Ramadan, Abu Dhabi is likely to face continued pressure from increased competition especially when additional hotels including the Ritz Carlton enter the market at the end of 2012 and early 2013,” said Peter Goddard, managing director of TRI Hospitality Consulting in Dubai.

— issacjohn@khaleejtimes.com