Colliers International Presents MENA Hotel Market Forecast at AHIC
- Egyptian markets witness largest forecasted increases in RevPar while Abu Dhabi looks set to benefit from demand side drivers
Dubai, UAE May 6 2015 –Leading hospitality industry investors, operators and professionals attending the Arabian Hotel Investment Conference (‘AHIC’) today gained a valuable insight into the performance and outlook of the MENA Hotel Market from Filippo Sona, Head of Hotels for Colliers International in the MENA region.
Mr. Sona’s presentation on the Colliers International MENA Hotel Market Forecast, a leading resource for industry decision makers, explored the dynamics driving current performance and future expectations across the region.
Commenting after his well-attended session, Sona said: “There are a number of powerful factors currently shaping the MENA hospitality market.I hope that our analysis, based on the breadth and depth of our understanding of the market, will provide a solid basis for budgeting and pricing strategies in the coming months.”
During his session, Sona highlighted the key opportunities and challenges that the industry will face over the next 12 months, with Dubai, Abu Dhabiand a resurgent Egypt highlighted as key markets to watch.
RevPar across Dubai’s districts is anticipated to remain static or witness a small declineof up to 2% by year-endowing to the size of the assets coming online coupled with the promotional rates that operators are offering to attract MICE visitors. This in turn is compressing overall room rates in the emirate, applying pressure to RevPar.
Commenting on Dubai’s outlook Sona said “While Dubai’s hotel market is going through a period of adjustment, it still retains its position as one of the world’s leading tourism destinations, and occupancy and Average Daily Rates (ADR) remain at a strong level. With a number of major tourism and leisure projects due to be released in the coming year, such as Dubai Parks, a readjustment in the market and double digit growth is expected to return in the near future.”
According to the report, Abu Dhabi Beach and City districtswill experience positive growth by year-end of 3% and 2% respectively, as major tourism, leisure and cultural developments includingSaadiyat Island, YasWaterworld and The Louvre Abu Dhabi entice tourists to visit and lengthen their stay in the capital. This, coupled with Etihad’s recent expansion of routes, will see the city gain in momentum.
“The positive outlook is a result of Abu Dhabi Tourism’s efforts to differentiate the city and its market offering. The demand generators that we have seen enter the market recently have all contributed to the overall brand equity of Abu Dhabi.We expect new supply to be absorbed by the market which will help Abu Dhabi go from strength to strength,” Sona said.
Given the popularity of Egypt among Russian tourists, the return of socio-political stability and increasing consumer confidence in Egypt, the country’s three key tourism cities are expected to see the largest increase in RevPar by year-end, with Cairo, Luxor and Sharm El Sheikh expected to increase by 28%, 33% and 10% respectively.
“Egypt is coming back in a big way following a tough period for the industry. The country is on a major drive to attract investment and the hospitality industry, traditionally one of the key sectors of the economy, is no exception. The numbers are impressive and reflect a sharp upturn in sentiment as tourism spending reached EGP 153 billionlast year, the highest level since 2008” Sona concluded.
ABOUT COLLIERS INTERNATIONAL MENA HOTEL MARKET FORECAST
Colliers International MENA Hotel Market is the first of its kind for the industry in the region. Providing 3 month rolling and year-end hotel performance forecasts for key performance indicators including hotel occupancy, Average Daily Rate (ADR) and Revenue per Available Room (RevPAR), spanning 29 submarkets across the Middle East and North Africa. The forecast is compiled using actual operating data from a sample of 3, 4 and 5 star hotels and quality serviced apartments, in addition to historical data trends, rolling averages and anticipated events.
ABOUT COLLIERS INTERNATIONAL
Colliers International is a global leader in commercial real estate services, with over 16,300 professionals operating out of more than 502 offices in 67 countries. A wholly owned subsidiary of The National Investor, one of Abu Dhabi’s leading investment management and advisory firms,Colliers International delivers a full range of services to real estate users, owners and investors worldwide, including global corporate solutions, brokerage, property and asset management, hotel investment sales and consulting, valuation, consulting and appraisal services and insightful research.Colliers International has been recognized and ranked by the International Association of Outsourcing Professionals’ Global Outsourcing 100 for 10 consecutive years, more than any other real estate services firm.