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28 January, 2016

Occupancy, room rates dip across Middle East hotels in 2015

Occupancy and average daily rates (ADR) in Middle East hotels slipped last year compared to 2014, according to a new report.

Thursday, Jan 28, 2016

Dubai: Occupancy and average daily rates (ADR) in Middle East hotels slipped last year compared to 2014, according to a new report.

Occupancy dipped 2 per cent year-on-year to 67.4 per cent, while ADR dropped 2.6 per cent to $192.82. This resulted in revenue per available room (RevPAR) decreasing 4.6 per cent to $129.98, as per a report by STR Global, a research firm for the hotel industry.

In December, occupancy declined 3.4 per cent compared to December 2014 to 66.8 per cent, and ADR decreased 4.1 per cent to $204.27, causing RevPAR to fall 7.3 per cent to $136.52.

In the UAE, occupancy declined 0.6 per cent year-on-year in 2015 to 74.8 per cent due to rising hotel room supply. Supply outpaced demand last year, growing 6.2 per cent and 5.6 per cent, respectively.

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Nearly flat revenue led to a drop in ADR by 6.2 per cent to Dh705.75 and RevPAR by 6.7 per cent to Dh528.19, according to the report.

Elsewhere in the region, Saudi Arabia hotels saw occupancy drop 2.6 per cent to 62.4 per cent, but ADR rose 3.6 per cent to 799.38 Saudi riyals and RevPAR edged up 0.9 per cent to 498.49 Saudi riyals.

In Egypt, however, hotels recorded a 4.2 increase in occupancy to 53.7 per cent and a 18.9 per cent jump in ADR to 616.46 Egyptian pounds, causing RevPAR to grow 23.9 per cent to 331.16 Egyptian pounds.

“Following the October plane crash in the Sinai Peninsula, flights to Sharm el-Sheikh from many destinations were placed on hold until March 2016, creating a knock-down effect in hotel performance. Other markets, including Cairo and Hurghada, helped performance in Egypt carry on, with ADR up countrywide by 11.5 per cent in December,” STR Global said in its report.

Jeddah, Saudi Arabia, hotels reported nearly flat occupancy at 74.3 per cent, while ADR was down 2.2 per cent to 948.31 Saudi riyals, and RevPAR declined 2.1 per cent to 704.60 Saudi riyals.

In Manama, Bahrain, hotels saw occupancy decrease 7.6 per cent to 51.5 per cent, ADR grow 6 per cent to 79.58 Bahraini dinars and RevPAR edge down 2 per cent to 40.99 Bahraini dinars.

Meanwhile in Northern Africa and Southern Africa, hotels saw occupancy edge up 0.2 per cent to 57.3 per cent, ADR up 7.1 per cent to $111.34, and RevPAR increase 7.3 per cent to $63.74.

However, in December compared to the same month in 2014, occupancy edged down 1.2 per cent to 51.8 per cent, ADR rose 11.3 per cent to $129.46, and RevPAR increased 10 per cent to $67.13.

Staff Report

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