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Abu Dhabi Abu Dhabi

Hotstats MENA Chain Hotels Market Review June 2017

Hotstats’ latest report MENA Chain Hotels Market Review June 2017 has indicated a challenging month for hotels across the region and in Abu Dhabi, while Sharm El Sheikh reported remarkable growth.

Ramadan Affected MENA Hotel Performance

While hotels in the MENA region achieved an overall year-on-year increase of 2.9 percent in gross operating profit per available room to USD44.55 in June, the impact of Ramadan and Eid al-Fitr meant that performance levels were some of the lowest in the past 12 months.

Most notably, occupancies across the region plummeted to 47.9 percent, well below the rolling average of 63.6 percent record in the 12 months to June. Doha and Kuwait particularly suffered with occupancy of 42.1 percent and 35.5 percent, respectively.

Compared to June 2016, RevPAR jumped 3.5 percent to USD88.84, while total RevPAR rose 1.7 percent to USD163.60.

Yet, profit per room the month was 44.7 percent below the average for the 12 months to June, at USD80.68.

Abu Dhabi Continued to Suffer

In June, hoteliers in Abu Dhabi recorded a monthly five-year low in RevPAR, which stood at USD49.96, 48.7 percent below the average for the previous 12 months, and a drop of 0.7 percent in year-on-year comparisons.

Occupancy was 51 percent, while total RevPAR fell 8.1 percent to USD109.61.

Despite a 16.6 percent increase in gross operating profit per available room (GOPPAR) over June 2016, properties across the capital reported a loss of USD5.09.

The month punctuated a challenging six months for hotels across the emirate, with year-to-date declines in key metrics, including a 13.8 percent decline in GOPPAR to USD51.71, resulting in profit conversion falling to just 28.1 percent of total revenue in the first half of the year.

Sharm El Sheikh Welcomed Influx of Tourists

Thanks to a surge in both Arab and domestic visitors in June properties in Sharm El Sheikh achieved a 324.1 percent year-on-year climb in RevPAR to USD12.13, led by a 13.8 percentage point increase in occupancy to 30.1 percent.

The uplift in volume also facilitated growth in non-rooms revenue, including a 175.3 percent jump in food and beverage, which contributed to the 239.3 percent boost in total RevPAR to USD20.22.

Despite these exceptional results, revenue levels were not sufficient to outweigh the high costs which meant hotels in the resort town recorded an USD1.50 loss in gross operating profit per available room for the reviewed month.