Dubai: Hotels in Dubai maintained a good performance last year, with an overall 83.6 per cent occupancy rate, according to a report by Ernst & Young (E&Y).
It stated that hotels enjoyed an overall occupancy rate of 81 per cent in December, up three per cent from the same time the year before.
However, occupancy rates are not expected to rise drastically [in 2013], according to Yousef Wahbah, MENA Head of Transaction Real Estate at Ernst & Young, “as the overall city is already experiencing high stable occupancy and more supply such as the Conrad and the second wing of the Marriott Marquis is expected to come online”.
Additionally, RevPAR (revenue per available room - a benchmark for performance) climbed 10.4 per cent year-to-date and 6.8 per cent monthly; while average room rate rose by 7.3 per cent year-to-date and 6.4 per cent monthly, as per the report.
“We expect a marginal increase in RevPAR this year, and a near six per cent growth in ADR (average daily rate),” said Wahbah.
Average room rates in Dubai this year are expected to keep with the trend and see an increase year-to-date, according to the report.
The strong year-end performance is credited to the high inflow of tourists that come for the yearly events, attractions, and conferences, highlighted the report.
Hotels can maintain demand and profitability over the coming 10 months by catering to “specific industry needs and customer demand,” said Wahbah.
“As more hotels come online, Dubai is focusing on revenue optimisation and staying competitive within the rooms and [the food and beverage] segments which are expected to yield higher profitability,” he said.
Meanwhile, Abu Dhabi hotels had their share of good performance levels. Hotels saw a 76 per cent increase in overall occupancy year-to-date. On a monthly basis, they recorded an overall occupancy rate of 80 per cent, a two per cent rise year-to-date. Wahbah said the capital is meeting consumer demand.
Abu Dhabi is “in the process of attracting visitors through the establishment of annual industry conferences, leisure destinations, cultural attractions such as The Louvre Museum, Yas Islands, the Yas Waterpark, alongside a number of institutes and specialized industry offices,” he pointed out.
Regionally, meanwhile, Saudi Arabia hotels experienced stable occupancy rates. While Jeddah recorded an overall occupancy of 80 per cent year-to-date, up seven per cent from the same period a year ago, Madina saw a 3 per cent rise in overall occupancy, while Makkah and Riyadh achieved a 2 per cent increase year-to-date.
Amman, Jordan, meanwhile, saw occupancy rates climb 14 per cent year-to-date, while RevPAR was up 29.2 per cent, and average room rates rose by 3.2 per cent year-to-date.
Egypt saw an overall occupancy rate of 70 per cent year-to-date, increasing in Cairo and Hurghada by 8 per cent, and in Sharm El Shaikh by 12 per cent.
Sarah Algethami is a trainee at Gulf News)
