Hotels in Riyadh and Jeddah emerged as leaders for both average room rate (ARR) and gross operating profit per available room (GOP PAR) in the Middle East in September, latest data from the TRI Hospitality Consulting showed. The two cities achieved ARR of $245.70 and ARR $212.70 respectively in September, and managed to post GOP PAR well above the other four cities covered in the survey. Riyadh's occupancy rates grew by 18.7 percent, while revenue per available room (RevPAR) rose by 52.6 percent and GOP PAR surged by 91 percent compared to the same month in 2010. Jeddah posted a 10.4 percent growth in RevPAR and 11.8 percent growth in GOP PAR for the month. “Hotels in Riyadh and Jeddah have seen a surge in demand in September due to a combination of reasons. The exit of Ramadan out of September and into August this year and the spill over of Eid holidays into September have favored the month's figures,” said Peter Goddard, managing director of TRI Hospitality Consulting in Dubai. “More importantly on a macro level, the ongoing security issues in the Levant and the government's efforts to promote domestic tourism have resulted in an increasing number of Saudi travelers now spending more time holidaying in the Kingdom, which also benefited hotels in Riyadh and Jeddah,” he added. Elsewhere in the region, occupancy rates in Dubai hit 78.6 percent in September compared to 71.8 percent in the same month last year. The increase in tourists prompted hoteliers to increase rates by 10.9 percent in September, resulting in a 21.5 percent growth in RevPAR, TRI Hospitality said. It added that GOP PAR rose 24.6 percent compared to September 2010. Dubai hotels' year-to-date GOP PAR of $110.10 is 30.9 percent higher than its neighboring city of Abu Dhabi and second only to Riyadh among the six cities covered in this survey. “Dubai hotels have clearly benefited from the Arabic Spring and such trend is unlikely to change until there is greater stability in the hot spot areas of Egypt and Syria,” Goddard further said. “However, with the uncertainty related to the ongoing economic problems in the euro region, there is a downside risk that the European tourist inflow into Dubai may decline, which might slightly dampen the year-end figures,” he added. In Abu Dhabi, TRI Hospitality data suggested room rates (ARR) fell in September by seven percent compared to the same month last year, although occupancy levels improved by a similar margin as Dubai. During the 12 months to September, Abu Dhabi posted a 20.9 percent decline compared to the same period in 2010. According to Abu Dhabi Tourism Authority, the number of hotel guests rose 14 percent in the first nine months of this year compared to the same period last year. “Regardless of the growth in demand, the continued growth in supply, albeit at reduced levels compared to the last couple of years, is likely to maintain the pressure on rates and increase the risk of oversupply in Abu Dhabi in the short to medium term,” Goddard said. TRI Hospitality said Cairo saw its hotel occupancy drop by 22.8 percent while Sharm El Sheikh registered a decline of 15.9 percent in September compared to last year.
