Dubai hotels record worst month in 18yrs

A sharp increase in hotel rooms & fall in demand saw Dubai hotel occupancy plummet to just 45% in July
Dubai hotels record worst month in 18yrs
By Courtney Trenwith
Tue 12 Aug 2014 10:30 AM

Dubai hotels have experienced their worst month in 18 years, newly released July occupancy rates show.

A sharp increase in supply (8.3 percent) coupled with a significant fall in demand (-4.5 percent) saw the emirate record an 11.8 percent drop in occupancy for the month, to less than 50 percent, according to STR Global, which monitors hotel occupancy rates each month.

The 45.4 percent occupancy rate is almost half the 80-plus level Dubai had been averaging earlier this year.

It is the worst monthly data since records began in 1996, according to STR Global.

The fall also drove down revenue per available room (RevPAR) by 7.4 percent to AED290.23.

Rather than attempt to boost occupancy with reduced rates, hotels hiked them up, increasing the average daily rate by an average 5 percent to AED638.66.

“Dubai reported the lowest occupancy levels of any month for the last 18 years, when STR Global began tracking hotel performance for the market,” STR Global managing director Elizabeth Winkle said.

“As July is one of the hottest months within the region and coincides with the fasting month of Ramadan, the city had an overall negative trend, on top of growing supply.”

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