Middle East hotels see 9% revenue drop in Q3

Absolute average daily rate (ADR) was lowest for quarter on record, according to STR
Middle East hotels see 9% revenue drop in Q3
By Sarah Townsend
Wed 26 Oct 2016 01:57 PM

Hotels in the Middle East saw declines in both revenue and occupancy rates in the third quarter of 2016, with absolute average daily rate (ADR) the lowest on record, according to the latest research from STR.

The Middle East overall reported a 1.6 percent drop in hotel occupancy to 63.3 percent compared to the same period the previous year, STR’s analysis of hotel performance for September 2016 showed.

ADR for the quarter was down 9.2 percent to $160.40 while revenue per available room (RevPAR) dropped 7.7 percent to $101.51.

The region also experienced a decline quarter-on-quarter – ADR for the month was down 5.9 percent to $177.83 while RevPAR dropped 7.5 percent to $118.75.

STR analysts cited a 3.6 percent year-to-date increase in supply and the economic fallout from the oil price drop as reasons behind the performance declines.

The report highlighted figures for select countries in the Middle East. It said Abu Dhabi reported year-on-year decreases across the three key performance metrics. Occupancy fell 3.3 percent to 65.8 percent; ADR was down 6.7 percent to AED372.46 ($101.4); and RevPAR dropped 9.7 percent to AED245.08 ($66.72).

Meanwhile, Bahrain saw a 5.1 percent increase in occupancy to 54 percent. However, ADR dropped 7.4 percent to BD76.30 ($202.3), and RevPAR fell 2.7 percent to BD41.22 ($109.3).

The absolute occupancy level was the best for a third quarter in the country since 2010, but the ADR decline was the steepest since 2004, STR said.

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