Abu Dhabi hotels lag behind Dubai amid competition

Abu Dhabi hotels registered the lowest profit among the GCC market for the month of September 2012, according to the latest Hotstats by TRI Consulting survey of full service hotels in seven MENA cities comparing September 2012 to the same period last year.

Abu Dhabi’s hotel market appeared “stagnated” as performance indicators declined significantly in comparison with September of last year, the report said.

ARR decreased 10.6% to US $124.28, and occupancies dropping 0.2 percentage points to 65.5%. Revenue per Average Room (RevPAR) decreased 10.9% to $81.37, and TRevPAR dropped 7.7% to $188.93.

The continued pressure on average rates coupled with a proliferation of competition depleted GOPPAR by 18.2% to $56.78, the lowest registered profit in the GCC for the month.

Meanwhile, hotels in Dubai showed strong profitability throughout the month of September this year, although the market witnessed a 2.8 percentage point decrease in occupancy. Average Room Rates (ARR) in the city increased by 3.9% to $218.30, while Total Revenue per Available Room (TRevPAR) grew 2.7% to $311.59, the report revealed.

The city hosted an array of events throughout the month of September allowing hoteliers to yield higher rates, thereby boosting Gross Operating Profit per Average Room (GOPPAR) 11.3% to $93.66.

“Dubai plays host to a miscellany of events throughout the month of September, namely INDEX and GITEX exhibitions which helped maintain healthy demand levels after Eid al Fitr. As the leisure segment continues to represent the largest demand in the city, the forecasted influx of leisure travellers over the next few months is likely to boost key performance indicators until the end of the year,” commented Peter Goddard, managing director of TRI Hospitality Consulting in Dubai.

“On the other hand, hotels in Abu Dhabi continue to register weak performance mostly due to the city’s heavy reliance on corporate demand which remained subdued throughout September,” Goddard added.