Mixed results for Starwood in Middle East in Q2

A mixed bag of performances across the region saw Starwood register slight falls in revenue per available room (RevPAR) and occupancy in the Middle East and Africa in the second quarter

By the end of the period, on June 30, the company had 162 hotels, with a combined 38,650 rooms.

In the Middle East and Africa, RevPAR was down 1.2% year-on-year to US $116.74, while the average daily rate (ADR) was up 0.6% to US $185.61. Occupancy was down 1.1 percentage points to 62.9%.

Speaking during an earnings conference call, Starwood president & CEO Frits van Paasschen explained how RevPAR varied drastically across the region.

“Behind this average is a wide range of performance across markets. In the Gulf States Abu Dhabi and Qatar saw REVPAR up over 17%. By contrast REVPAR in perennially strong Dubai was down slightly, thanks to some renovations and new supply, particularly on the Palm," he said.

“In Saudi Arabia REVPAR was flat held back by visa restrictions and concerns about the coronavirus, also business in Mecca was brought down by expansion works around the holy mosque. As that construction is completed likely next year business in the kingdom should improve.

“REVPAR to hotels in Egypt was down nearly 20% as we lapped a recovery that began in the first half of 2013 before being cut short in Q3. As we get into Q3 and Q4 we will start seeing easier comps there.”

He added that he expected momentum across the region to pick up in the third quarter, especially with the “easier comps” in Egypt.

Worldwide, RevPAR was up 5.1% to US $128.14, ADR was up 2.2% to US $178.19 and occupancy was up two percentage points to 71.9%.