Makkah hotels post record highs for occupancy, room rates in May

Analysts STR says hotels in Saudi holy city saw occupancy rates jump by 30%, room rates by 67% while RevPAR more than doubles
Makkah hotels post record highs for occupancy, room rates in May
By Sam Bridge
Wed 03 Jul 2019 02:06 PM

Hotels in the Saudi holy city of Makkah have posted record highs for occupancy, room rates and revenue in May, according to latest data from analysts STR.

The absolute values in each of the three key performance metrics - occupancy, average daily rates (ADR) and revenue per available room (RevPAR) - were the highest for any May in STR’s Makkah database.

STR said occupancy soared by more than 30 percent to 77.2 percent while ADR rocketed by 67.6 percent to SR1,446.79 and RevPAR more than doubled to SR1,116.61.

STR analysts noted that performance in the holy city was helped by Ramadan, as the number Umrah pilgrims continues to rise. Year-over-year comparisons were boosted even further by a favourable calendar shift as more Ramadan dates fell in May of this year than May 2018.

By contrast, hoteliers in Abu Dhabi saw all performance indicators decline in May, STR said.

Occupancy in the UAE capital fell by 14.9 percent to 52.2 percent while ADR dropped by 4.4 percent to AED335.39 and RevPAR slumped by 18.6 percent to AED175.10.

STR analysts attributed the performance declines to supply growth and the negative side of the Ramadan calendar shift.

"The market sees less business during the holy month, and while a majority of hotels ran special Ramadan offers to help stimulate demand, the number of rooms sold in the market fell 10.3% year over year. Supply, however, jumped 5.3 percent," said STR.

In the wider Middle East region, hotels reported mixed May performance results. Occupancy fell by 8.6 percent to 52 percent while ADR rose by 8.9 percent to $164.87 and RevPAR fell marginally by 0.4 percent to $85.75.

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