By Soren Billing
Saudi company says Dubai hotel worst hit in downturn, with revPAR declines of 46%.
Kingdom Hotel Investments (KHI) on Thursday posted a 9 percent decline in Q3 system revPAR and said that the Dubai market remained challenging.
“Trading remains in line with general market trends and despite the global economic challenges KHI’s hotel operations remain profitable and cash generative,” the luxury hotel operator said in a statement on the Nasdaq Dubai website.
Adjusted for currency movements, system rePAR fell 8 percent in the three months ended September 30 and 12 percent in the nine month period, reflecting “a continuation of the global economic slowdown”, it said.
RevPAR is a measure the performance of hotels that have been open at least a year.
The Middle East saw a 12 percent revPAR decline on a reported and currency neutral basis, with revPAR at the Movenpick Bur Dubai plunging over 46 percent compared to the same period last year.
“Dubai remains a challenging market, with weakness continuing in both occupancy and room rate,” the company said.
The company, controlled by Saudi billionaire Prince Alwaleed bin Talal, said Q3 was positively impacted by the full inclusion of Ramadan and the Eid Al Fitr public holiday.
Net debt at September 30 was $156m with cash balances totalling $362m, it said.
Having stayed there and put up numerous business colleagues at the Movenpick it is sad to see it leading the decline, because it is actually one of the nicest hotels in Dubai with good service, pleasant staff and a great location. If this property is suffering it means all the rest are doing just as badly, so maybe it is time for people to stop pretending nothing is wrong and all will be well in the morning. It will take five yeas to restore revPAR to previous levels, and even then refurbishments will be required at all the legacy hotels in Dubai.