Middle East hotels performance improves in 12mths

All three key indicators for hotel performance improved across the region in the 12mths to July, according to STR Global
Middle East hotels performance improves in 12mths
By Courtney Trenwith
Mon 25 Aug 2014 11:51 AM

Middle East hotels performed better in the past year, with occupancy levels, revenue and the average daily rate increasing, according to the latest figures.

Occupancy across the region rose to 68.9 percent in the 12 months to July, compared to 67.4 percent between July 2012 and July 2013, international hotel analyst group STR Global said.

The improved performance came despite lower occupancy during July, when it fell 2.2 percent to 47.4 percent. However, STR Global said it expected the low occupancy level to be an anomaly due to Ramadan falling entirely within July, which is already historically the region’s slowest month due to peak summer temperatures.

Dubai recorded its worst month in 18 years in July. 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 45.4 percent, almost half the 80-plus level Dubai had been averaging earlier this year.

Across the Middle East, hotels have been charging more per room in the past year, with the average daily rate (ADR) rising from $199 during 2012-13 to $205.20 in the 12 months to July.

That saw the average revenue per available room (RevPAR) also shoot up 5.4 percent to $141.40 during the same period.

While most cities saw declines in hotel performance during July, the Islamic holy cities of Makkah and Medina saw occupancy growth of more than 20 percent, due to pilgrims during Ramadan.

Makkah also saw a strong ADR increase, up 23.1 percent in July, STR Global said.

In the UAE, occupancy in July was down 7.9 percent to 46 percent, although the ADR increased to 4.2 percent.

Increased stability in Cairo compared to July last year, when former president Mohammed Mursi was ousted in a military coup, saw hotel occupancy soar 73.9 percent increase, although it remained low at 29.3 percent.

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