Mixed results for Saudi and UAE hotels over Haj and Eid

In Dubai, occupancy levels declined by 3.9 per cent and average daily room rates by 6.5 per cent during the three days of Eid.

The clock of the Abraj Al-Bait Towers in the holy city of Mecca. MOHAMMED AL-SHAIKH / AFP

Hotels in Dubai and Saudi Arabia reported mixed performances during this year’s Haj and a shorter Eid Al Adha holiday.

In Dubai, occupancy levels declined by 3.9 per cent and average daily room rates fell by 6.5 per cent during the three days of Eid celebration last month year-over-year.

That pulled down revenue per available room by 10.2 per cent.

Eid coincided with a weekend this year rather than weekdays last year and shortened the length of holiday, according to research company STR Global.

The average revenue per available room during those three days was Dh911.40, down from Dh1,014.60 last year.

In Saudi Arabia, the performance was better, as revenue per available room rose. STR did not provide data for occupancy levels or room rates in Mecca.

“Mecca was able to maintain high levels of revenue per available room during this period, similar to last year,” STR said.

At the start of Haj, Mecca hotels earned revenue per available room of about 2,000 riyals (Dh1,957), up from about 1,500 riyals last year. In Medina, the revenue per available room rose to 1,100 riyals in the same period, up from about 500 riyals.

This year, Saudi Arabia issued fewer Haj visas than it did in 2012 as expansion work around the Grand Mosque continued. Last year, 1.9 million pilgrims performed Haj, down from 3.1 million in 2012.

The country reported 723 cases of Mers and 300 deaths from the Mers-Coronavirus, according to the European Centre of Disease Prevention and Control, from 2012 through this August.

Earlier this year, international hotel operators such as Hilton, Starwood and InterContinental said construction work around the Grand Mosque and disease threat could keep visitors away. The chains operate some of their largest properties in terms of room inventory in Saudi Arabia.

Hilton reported a drop of 5.7 per cent in its room rates in Middle East and Africa to US$167, but occupancy levels rose by 11.7 percentage points to 63.7 per cent in the third quarter.

Starwood, which operates 10 hotels in the kingdom, reported in August that construction work and disease fears were a concern.

“As that construction is completed likely next year business in the kingdom should improve,” said Frits van Paasschen, the president and chief executive of Starwood. It has eight hotels under construction in Saudi Arabia.

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