UAE hotels record rise in occupancy and ADR

UAE hotels record rise in occupancy and ADR

Abu Dhabi’s revenue per available room up four per cent and 6.8 per cent in Aug and Sept respectively compared to the same months last year.



By Issac John (Associate Business Editor)

Published: Fri 28 Nov 2014, 11:41 AM

Last updated: Tue 7 Apr 2015, 10:40 PM

The Burj Khalifa is seen from Al Qasr hotel in the Old Town in Downtown Dubai. The emirate’s hospitality sector has been on the fast track of growth for several years in a row as it gears up for Expo 2020. — Reuters

Dubai — The overall UAE hospitality market witnessed a growth in occupancy and average daily rate, or ADR, through August and September despite a drop in ADR reported in Dubai, the region’s hospitality hub, during the same period, Ernst & Young said in a report.

Abu Dhabi’s hospitality market witnessed an increase in revenue per available room, or RevPAR, of four per cent and 6.8 per cent during August and September respectively compared to the same months last year. This was contributed by an increase in occupancy due to conventions in the city over the respective months, the report said.

Dubai’s overall ADR dropped from $213 in August 2013 to $195 in August compared to same month in 2013. Average occupancy jumped month on month from July 2014 by 27.5 per centage points, an increase due to the Dubai Summer Surprises Festival which commenced on August 2 and ended on September 5 compared to the event occurring in July in 2013, the report said.

“September also recorded a drop in ADR in terms of Dubai’s overall hospitality market, from $217 in September 2013 to $201 in September 2014. However, average occupancy witnessed a slight increase of 2.2 percentage points during the same period last year,” EY report said.

According to statistics published by STR Global, Dubai hotel rates remained above Dh1,000 a night in October despite increased supply. “Supply outpaced demand growth marginally for Dubai, resulting in flat occupancy growth and yet the city was able to maintain the same occupancy levels as the year before,” said Elizabeth Winkle, managing director of STR Global. From an ADR perspective, Dubai hotels were able to maintain their rates above Dh1,000, as Dubai starts to move into its peak period.

Dubai’s hospitality sector has been on the fast track of growth for several years in a row as the emirates gears up for Expo 2020, when it expects to draw 20 million visitors requiring an almost 100 per cent increase in the number of hotel rooms to more than 160,000 in five years.

Starwood, one of the largest hotel operators in the world, is scheduled to open 10 properties in the UAE through the first half of 2017. These include W Abu Dhabi, expected in 2016, W Dubai on The Palm in 2017, and Aloft Sharjah in 2016. Across its 22 properties in the UAE, the company currently has openings for 377 people.

In Dubai alone, the Department of Tourism and Commerce Marketing expects at least 139 establishments, including 91 hotels and 48 hotel apartments, to come to the market through 2016. The current supply is 88,680 rooms across 634 establishments. In the wider Mena region, the hospitality markets in Doha, Beirut, Manama, Cairo and Madina also witnessed positive growth across August and September 2014, recovering from slight drops in the earlier summer months.

Doha’s hospitality market witnessed an increase in RevPAR of 37.5 per cent and 27 per cent during the month of August and September 2014 respectively compared to the same months last year. This was mainly due to an increase in average occupancy from 46 per cent in August 2013 to 61 per cent in August 2014,which was the result of GCC nationals arriving to Doha for the Eid Holiday. Across September 2014, occupancy in Doha rose by 15 per cent from 59 per cent in September 2013 to 74 per cent in September 2014.

Hotels in Manama witnessed an increase in occupancy of 19 per cent during the month of August 2014, when compared to the same period last year. In September 2014, the upward trend in occupancy continued, increasing by eight per cent compared to September 2013.

“The Mena region’s hospitality industry recovered rapidly in August and September and we expect this growth to continue through 2014 and into next year. In the final months of the year, we expect further increases in overall occupancy rates, with the pleasant weather attracting more tourists, alongside the seasonal increase in events and conferences in the region,” said the report. issacjohn@khaleejtimes.com


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