ME hotels report lower occupancy

Hotels in the Middle East reported a 16.3 per cent drop in occupancy to 48.9 per cent in June while their average daily rates rose 12.5 per cent to $184.69 as revenue per available room fell 5.9 per cent to $90.25.
According to data from STR, the Middle East reported a 5.5 per cent decrease in occupancy to 62.9 per cent compared with second quarter 2015. Average daily rate for the quarter was down 3.0 per cent to $169.99. Revenue per available room dropped 8.3 per cent to $107.01.
Saudi Arabia experienced nearly flat occupancy (-0.5 per cent to 64.8 per cent), but a double-digit rise in ADR (+14.2 per cent to SAR816.60) drove a double-digit increase in RevPAR (+13.6 per cent to SAR528.86).
"Thanks to strong performance during Ramadan, the absolute ADR and RevPAR levels were the highest on record for a second quarter in Saudi Arabia. ADR in June was up 40.7 per cent to SAR1,239.28, and RevPAR increased 44.4 per cent to SAR780.27. STR analysts note that the holy cities of Makkah and Madinah were the only two major hotel markets in the Middle East to experience year-over-year RevPAR growth during Ramadan," STR said in a statement.
Manama reported decreases in each of the three key performance metrics. Occupancy dipped 4.0 per cent to 48.9 per cent; ADR dropped 4.9 per cent to BHD73.01; and RevPAR fell 8.7 per cent to BHD35.71. Overall results for the quarter were significantly affected by Ramadan and a 29.5 per cent decrease in June occupancy to 32.4 per cent. The previous five months of the year had produced year-over-year occupancy growth in the market.
On the other hand, data for May shows that hotels in Dubai recorded strong average occupancy of 86 per cent as revenue per average room dropped.
STR's June 2016 Pipeline Report shows 154,576 rooms in 550 hotels under contract in the Middle East and 55,736 rooms in 289 hotels under contract in Africa. Under contract data includes projects in construction, final planning and planning stages but does not include projects in the unconfirmed stage.
The under contract total in the Middle East subcontinent in June represents a 23.5 per cent increase in rooms compared with June 2015 and a 14.1 per cent year-over-year increase in rooms under construction.
The Middle East reported 81,951 rooms in 256 hotels under construction for the month. The under contract total in Africa represents a 29.1 per cent increase in rooms compared with June 2015 and a 31.5 per cent year-over-year increase in rooms under construction. Africa reported 30,703 rooms in 157 hotels under construction for the month.
With hardly four years for the World Expo 2020, when Dubai is expected to receive 20 million visitors, hotel rooms in the emirate are projected to witness an exponential growth, the emirate is driving the boom in the UAE's hotel industry.
JLL, a leading real estate investment and advisory firm, said Dubai is set to see a massive increase of 28,000 new hotel rooms by 2018. This is a further surge of 7,000 rooms from JLL's recent prediction of 21,000 new keys by 2017. With Dubai's hotel industry already hitting the 100,000-room milestone, the city aims to firmly position itself as a top 10 global destination in terms of available hotel supply.
- issacjohn@khaleejtimes.com