Jeddah achieves top performance levels in MENA for May 2017

The Ritz-Carlton, Jeddah, Saudi Arabia

According to EY's May 2017 MENA Hotel Benchmark Survey Report, Jeddah has succeeded as the top performer in the MENA market. The Saudi Arabian city has achieved the highest occupancy rates at 8.02 percent and highest RevPAR at $247, according to TradeArabia.  The survey stated that the majority of the region's hospitality industry saw a decline in revenue in May. Decreased occupancy and average room rates reduced overall RevPAR. 

"Moreover, the hospitality markets in Madinah and Makkah experienced positive gains in RevPAR this month when compared to May 2016," Yousef Wahbah, MENA head of Transaction Real Estate at EY told TradeArabia. "Madinah’s hospitality market witnessed an increase in average occupancy of 6.1 percent in May when compared to the same period last year. Average daily room rates also increased from $179 in May 2016 to $180 in May this year, resulting in an overall boost in RevPAR by 12.2 percent from $92 in May 2016 to $104 in last month."

The Makkah hospitality market's RevPAR rose by 90.5 percent in May—compared to the same period last year—because average room rate rose from $142 in May 2016 to $275 in May 2017. Makkah maintained its occupancy levels at 41 percent year-on-year.

"The increase in Madinah and Makkah’s hospitality market may be attributed to the beginning of the holy month of Ramadan where many worshippers prefer to perform Umrah and visit Madinah," Wahbah explained. "Jeddah, Makkah and Madinah are expected to continue this strong trend due to the holy month of Ramadan. As Eid Al-Fitr is expected to fall on June 25, it is anticipated that certain touristic destinations across MENA will experience strong performance during the last week of June.” 

Meanwhile, Abu Dhabi and Dubai also maintained strong occupancy levels at 73.5 percent and 77.8 percent respectively. However, RevPAR in those emirates declined compared to the same month in 2016. Dubai's RevPAR decrease by 11.6 percent in May 2017 may be attributed to the reduction in ADR from $225 in May 2016 to $211 in May 2017. RevPAR in Abu Dhabi’s hospitality industry decreased by 20.3 percent from $92 to $73. "The decrease was mainly due to the average room rate being lowered from $119 in May 2016 to $100 in May 2017, along with a decline in average occupancy by 3.8 percent when compared to May 2016," Wahbah said.

Occupancy levels in Cairo's hospitality industry also decreased by 10.1 percent from 74.4 percent to 64.3 percent as the average room rate increased from $47 to $87. In response, RevPAR increased by 61.9 percent, compared to the same period last year.