Dubai’s hospitality sector showed strong supply and demand growth in May, according to STR Global’s preliminary data, but revenues continued on their downward trend during 2015.
Declines in tourists from Russia and tougher competition from the likes of Egypt and Lebanon have impacted the bottom line of Dubai hotels in the first quarter of 2015.
New figures for May revealed increases in supply (up 5.6 percent) and demand (up 8 percent), said STR Global.
Its data also showed a 2.3 percent increase in occupancy to 80 percent but highlighted an 8.5 percent decrease in average daily rate to AED709.10.
STR Global also reported a 6.4 percent decrease in revenue per available room to AED567.50.
Its report said Dubai’s 80 percent occupancy level for May was helped by increased business travel from the Arabian Hotel Investment Conference (AHIC) and the International Design Exhibition (INDEX).
STR Global analysts said: “Slight uncertainty exists among investors in Dubai due to low oil prices. However, Dubai has established a successful flow of tourism in which to rely upon during such times.
“New prospects on the horizon, such as the Dubai Design District, also should bring a new mix of visitors to the city.”
Dubai’s hotels have experienced a more challenging 2015 after welcoming 11,629,578 guests in 2014, a 5.6 percent increase on 2013’s total while revenues soared by nearly 10 percent.
Dubai’s hotels and hotel apartments recorded an increase in guest nights in 2014, rising by 7.4 percent from 41.58 million in 2013 to 44.66 million in 2014. The average length of stay increased from 3.78 days to 3.84 days.
Revenues for hoteliers and hotel apartment operators saw significant growth, with total revenues reaching AED23.9 billion ($6.5 billion) for 2014, up 9.8 percent from AED21.8 billion in 2013. Room revenues increased by 12 percent year-on-year and F&B and other revenues increased by 6.1 percent year-on-year.
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