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Hotels in MENA saw a fall up to 64 percent

Staff writer |
Hotels in the Middle East and North Africa (MENA) failed to register high occupancy levels in July 2013, a HotStats survey by TRI Hospitality Consulting Middle East, showed. Hotels in Dubai and Abu Dhabi registered declining revenues and profits in July.

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In Dubai, occupancy declined 12.5 percent to 54.6 percent, which pushed revenue per available room (RevPAR — a benchmark for performance) to fall 16.8 percent. Average room rates (ARR), however, was up 2.2 percent to $196.87.

As a result of declining room and food and beverage revenues, total revenue per available room (TrevPAR) in Dubai dropped 10.7 percent to $242.98 compared to a year ago. Profitability declined 63.6 percent to $37.35. Meanwhile in Abu Dhabi, occupancy grew slightly by 0.5 percent to 50.1 percent, as per the survey.

But ARR fell 4.7 percent to $105.82, which caused RevPAR to grow 3.8 percent. Due to high operating costs, the Abu Dhabi market recorded falling profitability, according to the survey.

In Kuwait hotels registered small growth in occupancy of 0.7 percent to 42.8 percent, while RevPAR fell 2.2 percent to $101.02, as a result of ARR dropping 3.8 percent to $236.15. Additionally, TrevPAR was up 13.9 percent to $245.86.

In Jeddah, Saudi Arabia, hotels showed strong performance with occupancy growing by 81.2 percent, while RevPAR was up 11.6 percent to $214.75, triggered by a 15.3 percent growth in rates. Jeddah hotels recorded the highest profit margins among the markets surveyed, with gross operating profit per available room (GOPPAR) up 21.5 percent to $174.68.

In Riyadh hotels recorded a 4.2 percent drop in occupancy to 43.9 percent, which saw RevPAR fall 7.9 percent to $96.06. Profitability was down 10.3 percent to $53.20.

Similarly in Cairo, occupancy dropped 23.5 percent to 21.3 percent, which triggered RevPAR to fall 46 percent to $25.31. In Sharm al Shaikh, hotels also saw occupancy levels drop 7.5 percent to 58.2 percent., while RevPAR fell 10.4 percent to $23.4.

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