STR says hoteliers remain under pressure as Gulf kingdom embarks on major hotel construction drive
Occupancy levels and room rates continue to be pressured by growing hotel supply in Saudi Arabia, according to analysts STR.
Its January performance report showed that hotel supply rose by more than 9 percent, resulting in a 5.2 percent fall in average daily rate (ADR) to SR566.34.
The January school holiday, which fell primarily in February last year, pushed a 16.4 percent rise in demand which enabled occupancy levels to rise by 6.4 percent to 59.5 percent.
STR figures also showed that revenue per available room (RevPAR) for Saudi hotels rose marginally by 0.9 percent to SR336.70 in January.
Analysts added: "Saudi Arabia’s hotel development pipeline represents 76 percent of the existing room supply in the country. However, we stress the importance of considering the long-term investments being made in tourism and hospitality as part of Vision 2030."
Hotels in the wider Middle East region reported mixed January performance results, with occupancy up by 1.9 percent to 69.1 percent while ADR slipped by 3.4 percent and RevPAR fell by 1.6 percent.