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Room rates on rise in Middle East and North Africa, says HotStats

Hotels in the region saw a 5.8 per cent increase in average room rate in August
03/10/2017

Pictured: hotels in Doha are struggling as they start to feel the impact of economic and diplomatic sanctions

Hotels in the Middle East and Africa bounced back in August according to the latest HotStats survey.

Hotels in the region suffered a 1 per cent point decrease in room occupancy in the month. However, this was more than offset by a 5.8 per cent increase in average room rate to $153 (£115) in August.

Pablo Alonso, CEO of HotStats, said: “Further to recording a low in both top and bottom line performance in July and a tough period of trading so far in 2017, hotels in the Middle East & Africa were looking to bounce back in August, which they did.

“And although the profit levels recorded this month were more than a third lower than the year-to-date figure, these small victories will keep Middle East & Africa hoteliers going until the fundamentals of the hotel market begin to improve.” 

One of the markets which helped to drive the positive performance for the region this month was Makkah, where profit levels soared as a result of the annual Hajj pilgrimage.

While hotels in the holy city always benefit from the demand associated with the religious festival, with almost two million people descending on Makkah to observe the fifth pillar of Islam, the timing this year, for which the peak day was on 30 August, meant the premium performance was pushed into August.

As a result of the demand for hotel accommodation significantly outstripping supply, room occupancy at hotels in Makkah increased by 16.7 per cent to 76.8 per cent, with average room rates increasing by 75.9 per cent to $298 (£224).

In contrast to the performance in Makkah, hotels in Doha are struggling as they start to feel the impact of the economic and diplomatic sanctions which have rocked the nation.

This month, year-on-year room occupancy levels in Doha plummeted by 6.8 per cent to 50.6 per cent, with a 3.2 per cent decline recorded in achieved average room rate to $160 (£120), which is the lowest level recorded in recent years.

Alonso added: “With ties now severed between nine Arab states and Qatar, demand for hotel accommodation is being hit hard and so are costs, as Qatar produces very little of its own food. A double whammy on the bottom line.”


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