Half year results from the HotelBenchmark Survey by Deloitte reveal Middle East hospitality is enjoying its fourth consecutive year of double-digit growth, with an increase in revPAR (revenue per available room) of 13.7%.
At US$108 it boasts the highest revPAR of any region in the world, outstripping Europe and Asia Pacific at $97 and the US at $100. According to Deloitte, in the first six months of this year, average revPAR in the Middle East grew $17 due to higher average room rates.
Dubai is far and above the leader in the region, with a staggering revPAR of $255 and there is huge discrepancy across the Middle East as other markets such as Luxor report figures of just $24.
However, according to HotelBenchmark executive director, Lorna Clarke, the region”s growth rate is beginning, as predicted, to slow. ”As expected hotel performance across the Middle East has slowed slightly compared to last year but this is still in double-digit territory.”
Muscat saw the highest growth in the region during the first half of 2007 with an increase in revPAR of 54.8% to $164, driven by soaring average room rates that have risen 44.2%. These have been due, reports Deloitte, to the closure of four key hotels for refurbishments and a cyclone that forced a number of residents into temporary hotel accommodation.
Riyadh was second in terms of growth, again due to exceptionally high room rates of $200 which took its revPAR to $170, up 40.3%. Egypt is also beginning to recover from the bombings in 2006, with Red Sea Resorts reporting the highest revPAR increase at 30%.
Syria has also seen remarkable profits, having boosted occupancy from 20.7% to 59% and although it remains a low revPAR market compared with others in the region at $57, it has grown significantly this year with a 31.8% improvement.
”The level of investment in the region continues to astound,” said Clarke. ”In the first quarter of 2007 alone, $2bn is reported to have been pumped into the hotel sector. Given the continued investment, strong economic performance and the media attention the region commands ” it”s not hard to see why the Middle East has the highest revPAR in the world.”
The only markets to have seen a fall in revPAR during the period were Beirut and Doha. Following tension between Israel and Hezbollah last year, occupancy levels have dropped to just 32.9% and as a result revPAR is one of the lowest in the region at just $39.
Doha's decrease, however, is due to exceptionally high performance in 2006 when the city hosted the Asian Games, as well as increased competition from new developments and extensions to existing properties.