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Off-season rates down 10 per cent in Dubai

Hotstats report shows that average room rates in June have fallen for the fourth consecutive year
12/08/2016

Pictured: Dubai hotel rates have fallen 10 per cent for the month of June, Hotstats reveals


Hotel rates in Dubai fell almost 10 per cent year-on-year for the month of June, as occupancy levels for the off-season plunged for the fourth consecutive year.


While June is typically a slow time for hoteliers in the Middle East due to extreme temperatures and Ramadan, Hotsats points out that occupancy levels have been falling since 2013, when it was 79 per cent, to 51 per cent in June 2016.


In its quarterly Middle East and North Africa Chain Hotels Market Review, Hotstats says the continued fall in demand has led to a 9.2 per cent drop in average room rates (ARR), slipping from US$190 (£146) last year to $173 (£133).


Report authors said: "June is typically a quieter month for hotels in Dubai due to the stifling temperatures in the city and a trend for expatriates and locals alike to seek cooler climes, in addition to a high proportion of the population observing Ramadan. However, the volume of demand in June has been in constant decline in recent years, with room occupancy falling from 79.3 per cent in 2013, to 76.8 per cent in 2014, 67.4 per cent in 2015 and now 51.2 per cent in 2016."


Falling oil prices have been widely blamed for falling occupancy levels at fellow Middle Eastern hoteliers, while agency WRG also pointed to that as the reason for closing its Dubai office.


Kuwait hotel bookings were even lower, averaging 38 per cent for the month of June, signifying a 7 per cent drop year-on-year. Average rates had a similar 7 per cent decline, going from $228 (£176) in June 2015 to $213 (£164) in 2016. Conferences were also down 27 per cent as was food and beverage (-31 per cent).


Hotels in the Saudi Arabian capital of Riyadh suffered a 17 per cent drop in occupancy (40 per cent), yet ARR only fell 2.6 per cent to $210 (£162).



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