x Abu Dhabi, UAETuesday 23 January 2018

Unrest afar lifts some Gulf hotels

Middle East hotel performance boosted by improvements in UAE and Saudi Arabia, while North Africa sees sharp falls.

Unrest in some countries in the region continued to drag down occupancy levels at hotels in North Africa, while diverted travel to the UAE helped to boost the occupancy numbers for the Middle East, according to a new report.

"With the Arab spring and its consequences still ongoing across parts of northern Africa and the Middle East, northern Africa reported a 45 per cent revenue per available room drop, mainly driven by occupancy declines as demand stayed away," said Elizabeth Randall, the managing director of STR Global, a hotel industry research company. "The Middle East's overall performance increased in occupancy and average room rate, driven by improvements in the largest two hotel markets of the region - Saudi Arabia and the United Arab Emirates."

In the Middle East, average hotel occupancy increased to 69.1 per cent last month from 67.6 per cent in April last year. Hoteliers in Dubai in particular say they have benefited from the regional unrest, with the data showing that revenue per available room increased 13.3 per cent to US$216.67 (Dh795.82) last month over April last year.

For the same period in Abu Dhabi, hotel occupancy rose 15.7 per cent to 69.3 per cent, but room rates declined 20.3 per cent to $164.97.

Hotels in Saudi Arabia experienced a 26.3 per cent increase in revenue per available room.

Cairo hotel occupancy fell 52.1 per cent to 33 per cent from April last year. Cairo's 33 per cent hotel occupancy last month was better than March's 23.3 per cent.

"Everybody was surprised by the intensity of the unrest," said Jim FitzGibbon, the president of worldwide hotel operations for Four Seasons, which has hotels in Egypt and Syria. He said occupancy at its Damascus hotel was in "the 20 per cent range".

"No question, Syria is a concern for everybody," he said.

Four Seasons yesterday said it expected to open a hotel in Dubai within three years, after plans for a property in Festival City fell through. The luxury operator has a property under development on Sowwah Island in Abu Dhabi.

"Hopefully" a deal for Dubai would be announced this year, said Mr FitzGibbon.

Four Seasons and Al-Futtaim announced plans in 2004 to build the Four Seasons Hotel Dubai at Festival City, to accompany Al Badia golf course. Four Seasons gave up the management of the golf course in 2009, as the hotel never materialised.

Four Seasons belongs to Kingdom Holding, which is owned by Prince Alwaleed bin Talal bin Abdulaziz Al Saud of Saudi Arabia, and by Cascade, the investment company of the Gates Foundation.