Bumper harvest

The first half results are in and according to the HotelBenchmark Survey by Deloitte, hotel performance was strong in nearly all key cities across the region.

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By  David Ingham Published  September 2, 2004

Numbers|~||~||~|The month of June is a key one for followers of the HotelBenchmark Survey by Deloitte. It gives the first indication of how occupancies, rates and revPAR are holding up during the summer season, and it also offers the opportunity to evaluate first half performance. There is good news on both fronts. Amman and Cairo, cities that were adversely impacted by war jitters in the first half of 2003, have bounced right back, Dubai and Doha continue to be the region’s star performers and Muscat is clearly a destination on the rise. Even Riyadh saw occupancies in the 50% range, despite recent problems in Saudi Arabia. It is in Amman and Cairo, however, that hoteliers will be feeling most relieved. Amman saw room occupancy average 65.1% in the first six months of 2004, a rise of 67.5% year on year. Cairo enjoyed average occupancy of 73.7% in the first half, a rise of 43.5% year on year. Although both cities saw very little change in average room rates, both posted hefty increases in revPAR. It would appear that a policy of keeping room rates steady is paying off in higher occupancies and greater spending by guests. Elsewhere, Dubai’s rise continues. Average occupancy of 79.7% in June was very strong for a summer month and was a rise of 5.5% over the previous year. There were even bigger increases in the average room rate (30.5% year on year in June) and revPAR (37.7%.) For the first half as a whole, average occupancy touched 88.7%. Doha, a star performer in the last 18 months, saw average occupancy rise by just 1.0% in June, but by 18.8% for the first half as a whole. Average room rate and revPAR grew much more quickly. The city that struggled the most during June and the first half as a whole was Riyadh. In June alone, average occupancy fell 15.6% year on year to a level of 50.5%. For the first half, occupancy in the Saudi capital averaged 57.8%, down 5.4% year on year. RevPAR also disappointed; it fell 7.0% in June and edged up 1.0% for the first half as a whole. One encouraging sign for Riyadh’s hotel managers is that disappointing occupancy rates have not yet led to a cut in room rates. At an average of $128 for June and $131 for the first half as a whole, Riyadh’s room rates remain amongst the highest in the region. Muscat, often talked of as the next big thing in regional tourism, turned in a respectable performance. Although June’s occupancy rate of 55.2% was disappointing, the figure for the first half was a very healthy 71.3%, up 36.8% year on year. RevPAR was also strong, growing 58.5% in the first half to reach $58. The data suggests that the first half was generally a good period for hotels across the Middle East. Hoteliers will be hoping for more of the same in the second half. To learn more, visit www.HotelBenchmark.com, or e-mail HotelBenchmark@deloitte.co.uk||**||

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