Hotel room rates across Dubai drop despite surge in visitor numbers
More tourists are supposed to be visiting Dubai, but why are hotels slashing their rates?
Dubai: The average hotel room rates across Dubai have dropped despite a surge in visitor numbers, according to a new report.
The latest preliminary data released by STR analysts on Monday showed that most hoteliers across the city are still enticing guests with lower rates in a bid to fill their rooms.
During the month of December, hotels were charging less, with the average daily rate (ADR) dropping 4.3 per cent to Dh758.80, while the revenue per available room (RevPAR) fell 6.9 per cent to Dh600.98.
December or the last quarter of the year is traditionally a busy period for the tourism industry in Dubai. Last November alone saw 6.9 million passengers arriving in Dubai International.
One of the top tourist destinations in the UAE, the Dubai Parks and Resorts attracted more guests, with nearly 2.8 million people visiting in the fourth quarter of 2018, up 22 per cent from the same period in 2017.
With high guest arrivals, demand for hotel rooms in the city, which is measured by room nights sold, went up by 5.6 per cent in December.
However, there hasn’t been enough guests to fill all the available rooms, which is why most hotels were not fully booked throughout the month.
The overall occupancy rate for December fell by 2.7 per cent to 79.2 per cent. The only exception was New Year’s Eve, when occupancy levels reached 97.1 per cent, up from 1.9 per cent from the previous year, but the average daily rate still fell 2 per cent to Dh1,703.15.
According to STR analysts, the problem is that there are just too many new hotels being built around the city.
“The story remains the same for Dubai. Demand continues to grow, but an influx of new inventory is pressuring occupancy and [average daily rate] levels,” STR said in its report.