Dubai hotel sector leads MEA industry growth in July

Dubai was once again the star performer as the Middle East and Africa (MEA) hotel industry reported positive results across three key performance metrics in July, according to the latest data issued by STR Global.

The emirate achieved double-digit growth in occupancy (+24.7% to 57.8%) and revenue per available room (RevPAR), which was up 21.9% to AED346.76 ($94.40).

However, ADR dipped slightly by 2.2% to AED599.62 ($163.27). The average occupancy rate remained at or above 75.0% during the latter half of the month.

STR Global revealed ADR across Dubai had been under pressure, with year-to-date supply growth (+6.2%) outpacing demand (+5.1%).

The UAE posted double-digit increases in occupancy (+24.1% to 57.6%) and RevPAR (+23.6% to AED307.46), while ADR was down 0.4% to AED533.88 ($145.37).

The start of Eid Al-Fitr saw a return to growth across key metrics, including occupancy and RevPAR. Demonstrating the UAE hotel sector’s resilience, occupancy rates increased during the Ramadan period by 1.9% to 59.4%. Combined ADR for June and July was down 4.5% to AED523.8 ($142.63), and RevPAR dropped 3.2% to AED310.60 ($84.57).

Across the region, the average occupancy rate increased 12.1% to 55.1%, while the average daily rate (ADR) rose 5.3% to US$159.10. Revenue per available room (RevPAR) increased 18.1% to $87.69.

By way of comparison, Saudi Arabia reported a 0.7% increase in occupancy to 59.1%, a 1.2% rise in ADR to SAR1,260.93 ($336.10) and a 1.9% increase in RevPAR to SAR745.84 ($198.80). July’s occupancy rate marked the kingdom’s highest for the month since 2012, driven largely by strong demand in Makkah.

STR Global found that during the final 10 days of Ramadan, Makkah occupancy rose to 82.8%, and ADR increased to SAR3,061.88 ($816.15).

Riyadh reported increases in occupancy (+1.0% to 35.6%), ADR (+7.2% to SAR812.48) and RevPAR (+8.3% to SAR289.29). Despite this, the average occupancy rate in the Saudi capital did not breach 40% - the third consecutive year it has failed to do so.

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