Demand not outpacing hotel room supply in region
Hotel room supply grew by 5.7 per cent in Q1 2015
Dubai: Hotel room supply in the Middle East continues to outpace demand this year, according to Elizabeth Winkle, managing director of research firm, STR Global.
While demand grew by 4.5 per cent in the region during the first quarter of 2015, room supply grew by 5.7 per cent, Winkle said at a session at the Arabian Hotel Investment Conference (AHIC) in Dubai on Wednesday.
She said that 15,000 rooms were added in the Middle East over the last six months.
“It’s a trend this quarter. It’s not something that I’m concerned about. We are seeing as a result some softening in occupancy and [room] rates,” she said.
She added that, due to the decrease in occupancy and average room rates, revenue per available room (an industry benchmark for performance) dropped 2 per cent in the first quarter of this year.
According STR Global’s recent report, hotels in the Middle East and Africa saw occupancy increase by 2 per cent to 68.7 per cent year-on-year in March, while average daily rates dropped 2.3 per cent to $171.8. As a result, revenue per available room edged up 0.7 per cent to $118.
