Dubai: Average room rates and occupancy rates dropped at hotels in Dubai in November 2017 driven by increased supply of rooms across the city.
According to the latest report from consultancy EY, room rates fell 1.4 per cent year-on-year to $286 (Dh1,050), leading to a 2.8 per cent drop in revenue per available room to $252.
The decline came despite an increase in tourist arrivals in November owing to the cool climate and key events such as Dubai Airshow and Motor Show.
Meanwhile in Abu Dhabi, fortunes were reversed as hotels in the capital saw an increase in occupancy by six percentage points to 88.6 per cent in November. This was due to the opening of the Louvre Abu Dhabi and the Formula 1 race, both of which happened in November.
Room rates were also lower, however, falling 4.1 per cent year-on-year to reach $169, EY said.
“Overall, the internationally-branded four- and five-star hotels of the Middle East hospitality market witnessed a slight decrease in [key performance indicators] in November 2017 when compared to the same period past year,” said Yousuf Wahbah, Middle East and North Africa real estate, hospitality, and construction sector leader at EY.
“In the GCC, all markets except Kuwait and Muscat recorded lower revenue per available room, reflecting the slowdown in performance witnessed across the wider Middle East and North Africa (Mena) region,” he added.
The Mena hospitality market is expected to continue the same trend until the end of the year, EY said.
However, hotels in the GCC can expect some improvements across certain cities over the next few months due to better weather conditions and attractions such as the Dubai Shopping Festival.
