MENA Chain Hotels Market Review January 2012
Shopping festivals helped hotels in Jeddah and Dubai register substantial growth in revenues and profits during the month of January 2012, according to the latest HotStats survey by TRI Hospitality Consulting.
Occupancy levels in Jeddah went up by 11.6 percentage points to 75.5% and Average Room Rate (ARR) increased by 15.2% to US$217.43 during the month, boosting Revenue Per Available Room (RevPAR) by 35.2% to US$164.04. The growth in the top line, combined with a 2 percentage point drop in payroll costs, caused a surge in profit during the month as the Gross Operating Profit Per Available Room (GOPPAR) surged to US$115.35, up by 63.7% over the same period in 2011.
The growth in hotel performance comes in the wake of the inaugural Jeddah Shopping Festival, also known as Hayya Jeddah 2012, which was kicked off on 18th January. According to the event organisers, the month-long festival was expecting to attract over a million visitors to the city from both within and outside the kingdom as it coincides with the spring break for schools in the region.
In Riyadh, however, hotels saw a dip in overall performance during the month as average occupancy dropped by 2 percentage points to 61.5% and ARR declined by 7.6% to US$258.29. Consequently, the city witnessed a 10.5% drop in RevPAR and 6.2% drop in GOPPAR during the month making it the only GCC city amongst the four surveyed by HotStats to post a RevPAR decline during the month.
“The Saudi Commission for Tourism and the local authorities are undertaking numerous initiatives to develop tourism, mainly focusing on attracting domestic travellers. Some of these programs, such as the Jeddah Shopping Festival, are showing results. These are indeed steps in the right direction to boost local tourism sectors and will also help reduce seasonality issues and improve overall performance of hotels”, commented Peter Goddard, managing director of TRI Hospitality Consulting in Dubai.
In the UAE, hotels in Dubai achieved notable improvement across all performance measures in January and outperformed the other MENA markets surveyed by HotStats by a big margin. Occupancy and ARR for the four and five star chain hotels in the emirate increased by 4.5 percentage points and 9.9% to touch 87.7% and US$327.41 respectively as the city hosted the 17th edition of Dubai Shopping Festival (DSF) during the month. Hotels across the city reported peak occupancy and rates during the month, boosting the citywide RevPAR by 15.8% to US$287.25 and GOPPAR by 18% compared to the same period last year.
“The 2011 edition of DSF is estimated to have attracted 3.9 million visitors during the month. The figures for 2012 are yet to come through, but given the growth tend in visitor arrivals, these figures are likely to have grown substantially this year. The DSF has given a solid start to the year and I believe that Dubai hotels will continue to see strong performance levels during 2012”, said Goddard.
Shopping festivals helped hotels in Jeddah and Dubai register substantial growth in revenues and profits during the month of January 2012, according to the latest HotStats survey by TRI Hospitality Consulting.
Occupancy levels in Jeddah went up by 11.6 percentage points to 75.5% and Average Room Rate (ARR) increased by 15.2% to US$217.43 during the month, boosting Revenue Per Available Room (RevPAR) by 35.2% to US$164.04. The growth in the top line, combined with a 2 percentage point drop in payroll costs, caused a surge in profit during the month as the Gross Operating Profit Per Available Room (GOPPAR) surged to US$115.35, up by 63.7% over the same period in 2011.
The growth in hotel performance comes in the wake of the inaugural Jeddah Shopping Festival, also known as Hayya Jeddah 2012, which was kicked off on 18th January. According to the event organisers, the month-long festival was expecting to attract over a million visitors to the city from both within and outside the kingdom as it coincides with the spring break for schools in the region.
In Riyadh, however, hotels saw a dip in overall performance during the month as average occupancy dropped by 2 percentage points to 61.5% and ARR declined by 7.6% to US$258.29. Consequently, the city witnessed a 10.5% drop in RevPAR and 6.2% drop in GOPPAR during the month making it the only GCC city amongst the four surveyed by HotStats to post a RevPAR decline during the month.
“The Saudi Commission for Tourism and the local authorities are undertaking numerous initiatives to develop tourism, mainly focusing on attracting domestic travellers. Some of these programs, such as the Jeddah Shopping Festival, are showing results. These are indeed steps in the right direction to boost local tourism sectors and will also help reduce seasonality issues and improve overall performance of hotels”, commented Peter Goddard, managing director of TRI Hospitality Consulting in Dubai.
In the UAE, hotels in Dubai achieved notable improvement across all performance measures in January and outperformed the other MENA markets surveyed by HotStats by a big margin. Occupancy and ARR for the four and five star chain hotels in the emirate increased by 4.5 percentage points and 9.9% to touch 87.7% and US$327.41 respectively as the city hosted the 17th edition of Dubai Shopping Festival (DSF) during the month. Hotels across the city reported peak occupancy and rates during the month, boosting the citywide RevPAR by 15.8% to US$287.25 and GOPPAR by 18% compared to the same period last year.
“The 2011 edition of DSF is estimated to have attracted 3.9 million visitors during the month. The figures for 2012 are yet to come through, but given the growth tend in visitor arrivals, these figures are likely to have grown substantially this year. The DSF has given a solid start to the year and I believe that Dubai hotels will continue to see strong performance levels during 2012”, said Goddard.
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