Dubai hotels affected by declining Euro and Dollar
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The combined effect of the falling Euro and stronger US Dollar continues to be a key challenge facing Dubai’s hotels, as average room rate (ARR) fell by 10.8% to US$271.64 during May.
Although, occupancy levels remained strong at 83.8%, up 1.9% over the same period last year, the fall in ARR resulted in an 8.7% reduction in revenue per available room (RevPAR).
Dubai’s four and five star hotels also witnessed softer food and beverage demand, which had a direct impact on total revenue per available room (TRevPAR) and gross operating profit per available room (GOPPAR), falling by 11.7% and 14.5% respectively.
Four and five star hotels in Jeddah also saw occupancy levels fall by six percent in May to 75%, forcing hoteliers to reduce room rates in order to maintain market share. With ARR dropping by 10.6% to US$258.19, RevPAR plummeted by 17.2% to US$193.74, compared to last year. Although higher food and beverage revenues helped offset reduction in rooms revenue, TRevPAR and GOPPAR fell by 14.7% to US$317.44 and 29.8% to US$143.04 respectively.
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