Dubai's hotel market, which reached the bottom of the market cycle in Q1, continued to perform well, with occupancy rates rising to 81 percent and Average Daily Rates (ADRs) stabilizing, Jones Lang LaSalle, the world's leading real estate investment and advisory firm, said Tuesday in its latest "Dubai Real Estate Market Overview - Q2 2011". Improving occupancy combined with stabilizing ADRs, resulted in 5 percent growth of RevPAR during the first four months of 2011. At the end of Q2 2011, the total hotel supply in Dubai stands at approximately 52,300 rooms. After experiencing a significant decline in 2009 and 2010, the average trading performance of Dubai hotels has witnessed an improvement in the first four months of 2011. During this period, occupancy rates increased by 4 percentage points over the same period in 2010, surpassing 80 percent across all the major sub-markets in the city. After experiencing a significant decline in 2009 and 2010, the average trading performance of Dubai hotels has witnessed an improvement in the first four months of 2011. During this period, occupancy rates increased by 4 percentage points over the same period in 2010, surpassing 80 percent across all the major sub-markets in the city. Beach hotels registered the strongest improvement, evidenced by a 3 percent growth in ADRs and 11 percent growth in revenue per available room compared to the same period last year. Although supply is still expanding, the upward trend in tourist arrivals is expected to sustain the recovery. As of Q2 2011, Dubai's total hotel supply stood at 52,300 rooms, reflecting an increase of 2 percent compared to the end of 2010. Dubai witnessed a 10 percent increase in tourist arrivals in 2010 and is expected to receive about 8 million tourists in 2011 registering a growth of 17 percent. The strong growth in airport arrivals over the last year has continued to fuel hotel demand in the city. Dubai International Airport has registered a CAGR of 16 percent in arrivals over the last 10 years, reaching 23 million passengers in 2010. The top 5 source markets in 2010 were UK, India, Iran, Saudi Arabia and the US. A 25 percent increase was registered in demand from China over the last year. Occupancy levels in the first four months of 2011 have increased to 81 percent. This is an improvement of 4 percentage points over the same period in 2010. The previous contraction in Average Daily Rates (ADRs) has slowed significantly, with a marginal drop of just 1 percent YTD April 2011. Beach hotels have registered a 3 percent increase in YTD ADRs after declining over the last two years. Meanwhile, the number of tourists in Abu Dhabi rose 10 percent in the first five months of this year while hotel revenues were up 6 percent, the Abu Dhabi Tourism Authority (ADTA) said Monday. Hotels in the capital of the UAE in the five months had 866,501 guests in the first five months of 2011, staying a total 2.6 million guest nights, said ADTA. Revenues rose to AED1.9 billion ($517 million) despite falling room rates, while the average hotel occupancy rate jumped to 71 percent of capacity, an increase of 10 percent on the same period last year. Abu Dhabi, which accounts for around 55 percent of the UAE economy, is investing billions of dollars in industry, tourism and infrastructure to diversify away from oil. The emirate is hosting more leisure and entertainment events such as the Abu Dhabi Grand Prix, as well as major conferences and exhibitions as it looks to woo more visitors. The number of guests jumped 17.6 percent to 1.8 million last year, while the annual hotels occupancy rate dropped to 64.7 percent from 72.2 percent in 2009. Average room rates are down 15 percent year-on-year but the length of stay in the emirate rose by 15 percent to just over three nights, ADTA said. __
