Dubai city hotels continue to lead in terms of the highest occupancy in the region
15 May 2017
Commenting on the March 2017 MENA Hotel Benchmark Survey Report, Yousef Wahbah, MENA Head of Transaction Real Estate at EY said:
“Hotel performance in March dipped in the majority of MENA hospitality markets compared to March 2016. Across the GCC, most cities witnessed a decline in revenue per average room (RevPAR) in March 2017, compared to the previous year, with the exception of Kuwait City, which had an increase in both occupancy and RevPAR, Ras Al Khaimah (RAK) witnessed a modest increase in RevPAR.
Dubai city hotels continue to lead in terms of the highest occupancy in the region, recording 88.6% occupancy in March 2017. However, average daily rates (ADR) in Dubai dropped by 8.4% from US$309 in March 2016 to US$283 in March, coupled by a slight decline in occupancy by 1.5% when compared to the same time last year, leading to a decline from US$272 in March 2016 to US$245 in March 2017.
Hospitality markets in Beirut and Cairo, witnessed a positive increase across all KPIs in March. In Beirut, occupancy increased by 10.9% which was coupled with a rise in ADR from US$134 in March 2016 to US$139 in March 2017, resulting in an increase in RevPAR by 26.2% when compared to the same period last year.
Cairo’s hospitality market continues to improve month-on-month due to improved stability in the country, recording a 111.2% increase in RevPAR. Compared to the same period last year, hotel occupancy increased by 20.8% percentage points to reach 70.9% in March 2017. ADR in the city increased by 49.1% compared to last year, however Cairo’s room rates still remain one of the lowest in the region at US$79, due to the devaluation of the currency.
Looking at hotel performance in Q1 2017, all MENA markets with the exception of Cairo, Beirut and Kuwait witnessed a decline in room yield compared to Q1 2016. Dubai overall hotels maintained the highest MENA occupancy in the first quarter of the year at 86.8%.
The trend of a softer performance as compared to the previous year is expected to continue in MENA over the summer and the month of Ramadan, which starts towards the end of May.”