Dubai hotels see highest occupancy, best room rates in February

City-based hotels in Dubai saw the highest occupancy in the Middle East at 89.1 percent in February, while beach-based hotels had the highest average room rate at $399, according to a new report.

EY's February MENA Hotel Benchmark Survey report also showed that Abu Dhabi hotels experienced the highest increase in revenue per available room (RevPAR) compared to February 2016.

Abu Dhabi’s hospitality market witnessed an increase across all key performance indicators in February 2017. RevPAR increased by 21.7 percent mainly due to the increase in average daily rates (ADR) from $139 in February 2016 to $163 this February along with an increase in average occupancy of 3.1 percent.

The report said Dubai’s hospitality market witnessed an increase in average occupancy by 4 percent when compared to the same time last year.

The increase in occupancy may be a result of several events and exhibitions that took place in February such as the annual Dubai Jazz Festival, Gulf Food Exhibition, and the Bridal Show Event, EY said.

Kuwait’s hospitality market witnessed an 8 percent increase in occupancy rising to 54.6 percent, causing an increase in RevPAR by 2.8 percent to $122, driven by the popularity of the Hala February festivals, which include shopping and nightly celebrations.

According to the report, Doha was able to maintain its RevPAR performance at $138 while ADR fell to $189 in February despite a 6.4 percent rise in occupancy.

In Saudi Arabia, Riyadh and Jeddah’s hospitality markets witnessed a drop in RevPAR by 26 percent and 24.4 percent respectively when compared to the same period last year.

EY said the drop in Riyadh and Jeddah’s hotel performance could be attributed to the decreased number of conferences and exhibitions due to corporate spending cuts in both the public and private sectors.

Muscat’s hospitality market witnessed a decrease in RevPAR from $167 in February 2016 to $147, mainly due to the drop in ADR by 19.7 percent. Occupancy increased by 7.8 percent to 87 percent.

Yousef Wahbah, MENA head of transaction real estate at EY said: "Overall, the hospitality market across the GCC witnessed an even split in increases and declines of key performance indicators in February when compared to the same month last year.

"In the GCC, half of the markets saw an increase in revenue per average room (RevPAR) - these were the UAE, Kuwait, and Qatar - while the other half, Saudi Arabia, Oman, and Bahrain, saw a slowdown in performance."

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