Increasing supply hits Dubai hotel rates

Significant supply growth has placed pressure on occupancy and rates for Dubai hoteliers in November, according to new figures.

STR Global’s preliminary November data for Dubai revealed increases in supply (up 5.4%) were more than double that of demand (up 2.4%).

Based on daily data from November, Dubai reported decreases in all performance indicators when compared with the year earlier.

Average occupancy across Dubai hotels fell by 2.9% decreasing to 83% but STR Global said absolute occupancy in the market remains high and is in line with historical averages for November.

It added that the number of November visits to Dubai was boosted by the Big 5 International Building & Construction Show, DP World Tour Championship golf event, the Dubai International Motor Show, Dubai Airshow and Formula 1 Abu Dhabi Grand Prix.

Dubai hoteliers also saw a 7.1% decrease in average daily rate to USD$242 in November, while revenue per available room fell by 9.8% to $200.