Luxury Abu Dhabi hotel rates drop below $100
dubai — Regional hotels have become more affordable as average room rates in Dubai, Abu Dhabi and other Middle East and North Africa (Mena) cities dropped in May with the onset of summer.
However, the Saudi hospitality industry bucked the trend due to the increased inflow of pilgrims during the holy month of Ramadan.
According to EY figures released on Sunday, average hotel room rates in four and five-star hotels in Abu Dhabi dropped below $100 per night. Hotels in Abu Dhabi enjoyed the highest occupancy increase and occupancy rates in Mena. Occupancy rate grew 8.9 per cent to 76.6 per cent in May 2018 as against 67.7 per cent for the same month last year. But average daily rates decreased 11.8 per cent from $101 in May 2017 to $89 in May 2018.
EY said Dubai’s hospitality market witnessed a dip across all key performance indicators as a result of the peak season of events and conferences coming to a close. Occupancy across Dubai hotels declined by 16.4 percentage points from 77.3 per cent in May 2017 to 60.9 per cent in May 2018. Average daily rates too dropped by 0.7 per cent from $238 to $236.
“Due to Ramadan beginning in mid May this year and the onset of summer, the overall decline in performance in the region is unsurprising,” an EY analyst said.
The report mainly covered global four and five-star hotels in the Middle East. According to EY, Saudi Arabia was the top performer across the other metrics, with Jeddah recording the highest daily rate of $351.
Saudi Arabia, however, benefitted from the large influx of pilgrims during the holy month. Over two million pilgrims were expected to have visited the holy city, resulting in increased key performance indicators across Makkah, Madinah and Jeddah, with declines only in Riyadh.
Occupancy rate in Madinah’s hotels increased by 4.2 percentage points to 68 per cent in May 2018 and ADR increased 11 per cent from $178 to $198.