We noticed you're blocking ads.

Keep supporting great journalism by turning off your ad blocker.

Questions about why you are seeing this? Contact us

Font Size

- Aa +

Mon 6 Aug 2018 01:51 PM

Font Size

- Aa +

Dubai sees 16% drop in hotel occupancy in May

Saudi Arabia ranked the region's top performer, according to report by Ernst & Young

Dubai sees 16% drop in hotel occupancy in May

Dubai’s hospitality market saw a 16.4 percent drop in occupancy from 77.3 percent in May 2017 to 60.9 percent in May, according to the MENA hotel benchmark report by global consultancy Ernst & Young (EY).

The report said the sector witnessed a dip across all performance indicators as a result of the peak season of events and conferences coming to a close.

The average daily room rate (ADR) dropped 0.7 percent from $238 to $236, leading to a 21.7 percent decline in revenue per available room (RevPAR) from $184 to $144 in the same period.

Abu Dhabi saw the highest occupancy rate, which grew from 67.7 percent in May 2017 to 76.6 percent in May. While the capital’s ADR dropped 11.8 percent from $101 to $89 during the same time, it maintained its RevPAR of $68 from last year.

Due to Ramadan beginning in mid-May this year, followed by the onset of the summer season, the overall decline in performance in the region is unsurprising, according to the report, which added that the majority of internationally branded four and five star hotels in the Middle East witnessed a decrease in occupancy.

“The MENA hospitality market will continue to see a drop in KPIs during the summer season as business travel declines and conferences and events are at a minimum,” it said.

However, Saudi Arabia was ranked the region’s top performer across other metrics, with Jeddah recording the highest ADR at $351, resulting in the highest RevPAR at $259 in May 2018.

It largely benefitted from the influx of pilgrims during the holy month, with over two million pilgrims expected to have visited the holy city. Makkah, Madinah and Jeddah all saw increased KPIs, with declines only witnessed in Riyadh.

Makkah’s ADR increased 41.3 percent from $165 to $233, resulting in RevPAR rising 60.4 percent from $89 in May 2017 to $143 in May 2018. Both are believed to be the highest increases across the region for the same period.

Madinah’s ADR rose 11 percent from $178 to $198, increasing RevPAR by 18.3 percent from $114 in May 2017 to $135 in May 2018.

Jeddah saw significant growth in ADR by 19.5 percent, up from $294 to $351 during the same time period, leading to a 23.2 percent rise in RevPAR from $210 to $259.

Arabian Business: why we're going behind a paywall

For all the latest travel news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.