Friday, Oct 21, 2016

Abu Dhabi: Hotels in Abu Dhabi reported a 6.4 per cent year-on-year drop in average daily room rates to Dh400 in September, along with a 6.7 per cent decline in occupancy rates to 68.9 per cent.

The absolute average daily rate (ADR) level is the lowest for a September in Abu Dhabi since 2005. On a month-on-month comparison, however, room rates were higher in September compared to the Dh349 recorded in August.

According to preliminary data from STR, an information provider, hotels in the emirate saw a 12.6 per cent decrease in revenue per available room (RevPAR) to Dh276 in September. The decline comes as demand dropped in the month by three per cent while supply grew 3.9 per cent compared to September 2015.

STR analysts attributed the decline in overall performance to the supply-demand imbalance, with supply growth outpacing demand.

In August, most performance indicators were also down, with RevPAR falling 7.8 per cent as Abu Dhabi hoteliers suffered declines in room occupancy (down 1.6 percentage points) and ADR (down 5.6 per cent), according to figures from HotStats, another data provider.

Profits per room were higher, however, rising two per cent year-on-year in August as hoteliers slashed costs to offset the decline in revenues. Cost savings included an 11.3 per cent reduction in payroll, and an 8.5 per cent saving in overheads per available room.

A report by HotStats said that the drop in room revenues was further exacerbated by a year-on-year decline in food and beverage revenues (down 9.3 per cent) and a drop in conference and banqueting revenues (down 24.4 per cent).

Elsewhere in the GCC, hotels in Doha recorded an 11.9 per cent year-on-year decline in August in average room rates, marking the 24th consecutive month of declines. This contributed to a 17 per cent drop in room rates in the 12 months to August 2016, HotStats said.

The decline was a result of drops across the majority of market segments including corporate (down 17.6 per cent) and leisure (down 10.9 per cent).

Despite costs savings, hotels in the Qatari capital saw a 17.8 per cent decline in gross operating profit per room in August.

Staff Report

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