Egypt hotels see growth despite civil unrest

Despite demonstrations against now ousted Egyptian President Mohammed Morsi, Cairo hotels posted positive growth in room rates and profits in May 2013.

The latest HotStats report by TRI Hospitality Consulting revealed average room rates in the city grew by 17.6% to US $110.26. However, the unrest impacted demand with occupancy levels declining 5% to 47.5%.

The city’s RevPAR was up 6.4% to $52.42, resulting in a 15.2% increase in GOPPAR to $45.94.

TRI Hospitality Consulting managing director Peter Goddard said: “Cairo continues to experience mixed performance with occupancy levels generally reflecting the state of uncertainty in the city. Nevertheless, the market has seen a recovery in average rates back to levels comparable to 2011, which has helped to strengthen bottom line performance.”

Sharm Al Sheikh demonstrated the strongest growth in RevPAR and ARR out of the seven MENA markets surveyed by HotStats. ARR grew 30.9% to $48.39 during the city’s peak season.

The growth in average room rates drove RevPAR up 23.4% to $27.19 in spite of a 3.4% decline in occupancy to 56.2%. TrevPAR increased 15.3% to $51.22, which resulted in 24.9% growth in GOPPAR to $18.03.

“Sharm El Sheikh is entering the peak season which is reflected in the spike in average rates on the back of the change in the seasonal rates for tour groups and travel agents,” commented Goddard.