MENA hospitality industry experienced mixed results in April 2017
30 May 2017
Commenting on the April 2017 MENA Hotel Benchmark Survey Report, Yousef Wahbah, MENA Head of Transaction Real Estate at EY said:
The MENA hospitality industry experienced mixed results in April 2017 as higher occupancies yet lower average room rates affected the overall revenue per average room (RevPAR).
Dubai experienced an increase across all KPIs, including the highest RevPAR of US$273, an increase of 18.7% when compared to last year. Dubai also saw the highest occupancy in April at 88% and the highest average room rate of US$310. Numerous events such as the Arabian Travel Market and the Arabian Hotel Investment conference attracted visitors from across the MENA region and may have helped boost the city’s hotel performance.
Abu Dhabi’s hospitality market witnessed a drop in RevPAR by 4.8% in April 2017, which can be attributed to the drop in ADR from US$133 in April 2016 to US$120 in April 2017. However, occupancy increased by 4.5% in April 2017 when compared to the same month last year.
Elsewhere in the GCC, Doha’s hospitality market witnessed an increase in average occupancy from 65.6% in April 2016 to 74% in April 2017. However, the city’s ADR dropped by 7.3% in April 2017 when compared to the same time last year. The increase in Doha’s hospitality market could be a result of Qatar Airways’ new offer for transit travelers who are eligible for a free one-night hotel stay if they choose to layover.
In Muscat, the hospitality market witnessed an increase in average occupancy of 7.7% when compared to the same period last year. This may be a result of the spring break and Easter holidays where expats from neighboring countries considered the city to be an ideal short getaway.
In Saudi Arabia, Riyadh’s hospitality market continues to witness an overall drop in performance month over month. RevPAR dropped from US$130 in April 2016 to US$106 in April 2017. This can be attributed to the drop in ADR by 10.9% in April 2017, coupled by a decrease in average occupancy of 5.8% when compared to the same time last year. However, Makkah saw an increase in RevPAR, reaching US$107, a 24.3% increase from last year, possibly due to an increase in religious tourism ahead of Ramadan.
Outside of the GCC, Amman’s hospitality market witnessed a decrease in RevPAR of 5.3% in April 2017 when compared to the same month last year. The drop is a result of the ADR decreasing from US$153 in April 2016 to US$148 in April 2017, though occupancy remained relatively steady.
Beirut also benefitted from the spring break and Easter holidays as occupancy increased by 13.2% to 68.8%, the average room rate increased by 14% to US$148, and RevPAR jumped by 40.9% to US$102 when compared to the same month in 2016.
With the start of Ramadan at the end of May, it can be expected that MENA cities will experience a softer performance until the Eid holidays at the end of June.”