Enquiries for serviced accommodation in the Middle East dropped by 14 per cent year-on-year during the 1 February-30 April quarter following the outbreak of the Iran war, according to the latest market report from specialist agency SilverDoor.
The company said that the reduction in Middle East demand was not as significant “as we would have expected”. It also emphasised that reservations for the United Arab Emirates were also “marginally up” year-on-year in the quarter, which illustrated that workers were still heading to the area despite the ongoing conflict.
“We didn’t see huge volumes of evacuations or displacement; instead, we’re continuing to see mostly intel gathering and contingency planning,” added SilverDoor in its report.
Another trend has seen Dubai-based corporates looking to move employees from the centre of the city to other locations in the UAE, such as Al Ain, Ras Al-Khaimah and Fujairah. Part of this is being driven by the banking and financial services sectors, which are bound by strict finance licences in countries like the UAE and Saudi Arabia.
In Europe, SilverDoor said pricing remained “fairly stable” in key cities compared with the previous quarter, although there were significant year-on-year price rises in London and Dublin.
Average daily rate in the UK capital rose to £196 in the quarter, which was an increase of 11 per cent on the same period last year. Rates in London are forecast to rise to an average of £203 in the next quarter from May to July. SilverDoor attributed this increased demand to a shift away from remote working back to office locations, with the market for office space picking up in London.
In Dublin, ADR for apartments rose by 9 per cent year-on-year to €167 in the quarter and is projected to go up to €174 in the next quarter.
Elsewhere in Europe, Paris recorded a 2 per cent year-on-year increase in rates to €155, while Amsterdam’s ADR fell 1 per cent to €207 and Zurich saw average prices drop by 6 per cent to €190.
SilverDoor also highlighted a decrease in serviced accommodation prices in the US ahead of the country hosting the World Cup football tournament, alongside Canada and Mexico, over the next few weeks.
The report said that initial concerns about World Cup host cities being “entirely booked up and surging rates turned out to be much less dramatic”.
Claire Barrie, SilverDoor’s chief commercial officer, added: “This quarter's data reinforces that corporates who can hold their nerve where they can, be swift to react to inventory releases, and use late-stage negotiating power can secure better rates and value in high-demand markets.
“Businesses still keen to travel during the World Cup in host cities look set to be able to take advantage of the recent softening of corporate housing rates.”
Barrie said corporates could also “apply this blueprint” to future major events such as the Olympics in Los Angeles in 2028.
SilverDoor’s market report is based on the booking of 568,000 room nights across 9,582 enquiries in 101 countries and 1,161 cities.