According to a recent report from HotStats, five and four-star hotels in Dubai continued to experience weakening average room rates (ARR) in November, falling 6.9% to US$315.03, whilst occupency levels remained strong, albeit marginally lower than the same period last year at 84.9%.
The 8.1% decrease in RevPAR was compounded by significantly lower food and beverage revenues which fell 12.0%, driving total revenue per available room (TRevPAR) 10.9% lower, to US$449.80. Higher operating expenses compounded lower overall revenues, reducing gross operating profit per available room (GOPPAR) by 15.8% to US$214.83.
Occupancy levels plunged in Sharm El Sheikh in November following the crash of a Russian civilian airplane in early November. A subsequent ban on travel and cancellation of flights to the region from Russia and various European countries severely impacted performance in the Rea Sea destination.
Occupancy levels fell 25.9 percentage points to 36.2%, resulting in a 42.0% drop in RevPAR to US$17.94. Fixed payroll expenses compounded the fall in top line revenues, pushing profit margins to their breaking point with GOPPAR dropping to US$1.24.
The continued low oil prices are starting to have an impact on Doha’s hotel market as demand levels fell in November with occupancy levels dropping 5.5 percentage points to 75.1%. The fall in demand impacted all remaining performance indicators with ARR and RevPAR dropping 12.8% and 18.8% respectively.
Higher F&B demand offset the softer room revenue; however it was not sufficient enough to prevent GOPPAR reducing 24.4% to US$142.99.
Jeddah hotels witnessed softening demand levels in November with four and five star hotels recording a 3.8 percentage point reduction in occupancy to 70.7%.
Hoteliers were unable to offset the falling demand as ARR fell by 3.8% to US$245.05. The decrease in occupancy levels had a negative effect on the remaining performance indicators with RevPAR and TRevPAR falling 8.8% and 3.8% respectively. Higher operations expenses compounded lower revenues with GOPPAR dropping 21.2% to US$108.23.
Although Beirut hotels witnessed a 3.7 percentage point reduction in occupancy levels to 58.2% in November, hoteliers were able to yield significantly higher ARR which rose 15.8% to US$142.29.
The growth in ARR had a positive impact on all performance indicators with RevPAR and TRevPAR increasing 8.9% and 15.2% respectively. However higher operational expenses limited the growth in profits with GOPPAR increasing 3.3% to US$23.20.