By Sarah Townsend
UAE markets see rates, RevPAR rise year-on-year, Saudi performance drops
Middle East and North Africa (MENA) hospitality markets recorded an increase in revenue and occupancy rates in July compared to the same period last year, according to the latest market review from EY.
Saudi Arabia was the only exception, EY said, experiencing a drop in performance in its hospitality market across key cities due to change in dates of Ramadan compared to July 2015.
The highest hotel occupancy rate in MENA in July 2016 was recorded in Jeddah (81 percent), according to the report, but this was lower than the 84 percent occupancy recorded in the city in July 2015.
In the UAE, Dubai, Abu Dhabi and Ras Al Khaimah all saw their occupancy and revenue per available room (RevPAR) rise in July 2016 compared to the same month in 2015.
Dubai occupancy rates rose from 61 percent to 67 percent year-on-year (a rise of 6.2 percent). This resulted in a 4.5 percent increase in RevPAR from $108 in July 2015 to $113 in July 2016. Average daily rate (ADR) dropped from $177 in July 2015 to $168 in July 2016.
Abu Dhabi’s hospitality market witnessed a positive increase in occupancy from 61 percent in July 2016 to 68 percent in July 2016.
The change in RevPAR was not shown in the report, and Arabian Business has requested these figures.
Meanwhile, Ras Al Khaimah’s hospitality market saw an increase in average occupancy from 48.2 percent in July 2015 to 65.7 percent in July 2016.
The increase in occupancy resulted in a rise in RevPAR by 27.4 percent in July 2016 when compared to the same period last year. The rise in occupancy was due to an increase of visitor arrivals from 54,155 in July 2015 to 73,326 in July 2016, EY noted.
Looking at the wider MENA region, hospitality markets in Beirut and Cairo witnessed a positive increase when compared to the same period last year.
Beirut’s hospitality market witnessed an increase in average occupancy from 58 percent in July 2015 to 63 percent in July 2016. However, ADR dropped by 23.7 percent in July 2016 when compared to the same month last year, resulting in a drop in RevPAR from $111 in July 2015 to $92 in July 2016.
Cairo’s hospitality market saw a positive increase across all indicators in July 2016. Average occupancy increased by 29 percent in July 2016 year-on-year. There was also a jump in ADR from $133 in July 2015 to $144 in July 2016, resulting in a rise in RevPAR from $53 in July 2015 to $98 in July 2016.
EY said the increase in Beirut and Cairo’s hospitality market is “primarily due to the summer holiday where a number of nationals living abroad return back to their home country to spend their holidays”.
Yousef Wahbah, EY’s MENA head of transaction real estate at EY, said: “With the Eid Al Fitr holiday falling in July 2016, many of the MENA hospitality markets performed positively compared to the same period last year.
“Overall, the Middle East hospitality markets are performing quite well during the usually quiet summer period.
“Hotel performance is expected to dip in August and September as the weather gets hotter, but performance should improve again towards the end of the year.”