Dubai’s hospitality market emerged as the top Mena performer in January, representing the highest occupancy at 85.7 per cent and highest RevPAR of $246 - over three times the average RevPAR recorded in other Mena cities, a new report revealed.

According to the January 2017 Mena Hotel Benchmark Survey Report released by Earnst & Young (EY), Dubai beach hotels had the highest RevPAR of $343, while city-based hotels in Dubai recorded the highest occupancy at 87.6 per cent. Despite the influx of new hotels, Dubai has managed to sustain extremely high occupancy levels year on year. However, average room rates and RevPAR dropped 8.1 per cent and 7.3 per cent percentage points (pp) respectively in January, which could be a result of an oversupply of rooms, encouraging the sector as a whole to lower room rates to remain competitive.

Abu Dhabi’s hospitality market maintained a strong occupancy of 77 per cent in January, but witnessed a decrease in RevPAR and ADR of 11.8 per cent and 10.6 per cent when compared to the period last year.

In Saudi Arabia, Riyadh and Jeddah’s hospitality markets witnessed a drop in RevPAR by 22.6 per cent and 27.5 per cent respectively when compared to the same period last year. The drop in Riyadh and Jeddah’s hotel performance may be ascribed to the decreased number of conferences and exhibitions due to corporate spending cuts in both the public and private sectors.

Cairo’s hospitality market saw an immense growth across all key performance indicators (KPIs) in January, witnessing the highest growth in RevPAR of 160 per cent at $64, up from $24 in January 2016, due to higher occupancy and room rates.

The city experienced the third highest occupancy rate in the region, behind Dubai and Abu Dhabi increasing by 13.7 percentage points from 56.6 per cent in January 2016 to 70.2 per cent in January 2017. The average room rate more than doubled increasing 109.2 per cent from $43 in January 2016 to $91 in January 2017. The positive performance is predominantly due to the holiday season and the devaluation of the local currency, making it more affordable for tourists and nationals who live abroad.

“Overall, the majority of the hospitality market across the Middle East witnessed a decrease in KPIs in January 2017 when compared to the same month last year," said

The Mena hospitality market is expected to continue the trend of a softer performance as compared to the previous years on account of the overall macro-economic environment. Furthermore, in select cities, the additional supply expected to enter the market over the year may affect the current room rates and monthly RevPAR when compared to 2016.” - TradeArabia News Service