SAUDI DEPENDENCE
Hotels in Bahrain are currently heavily dependent on the Saudi market, and this is likely to continue in the near future. Tourism arrivals from Saudi Arabia is predicted to increase from three million in 2016 to 4.3 million by 2021, according to GlobalData. The over-dependence on the Saudi market is considered a risk as a reduction in tourism flow from the kingdom may have substantial negative impact on Bahraini hotels.
Filippo Sona, director — head of hotels at Colliers International, says: “Considering that approximately 80% of hotel guests in Bahrain stem from Saudi Arabia and that the market is predominantly leisure-oriented, this means that the hotel market will generally follow the trends of the Saudi tourism market and economic situation.
“With continued low oil prices affecting the Saudi economy and spending, tourists have generally become more price sensitive. This has affected the performance of Bahrain’s hotels in the recent past; however, it is also an opportunity for new developments to target the more price-sensitive guests, by offering mid-market resorts.”
Sona added: “A more price-sensitive market would also result in tourists cutting down on flight costs (i.e. distance), which Bahrain could benefit from due to its proximity to Saudi Arabia. Another opportunity would be to develop lifestyle hotels in Manama that can appeal to the large young population. There is a gap of these type of hotels in Manama, which are mainly targeted towards Generation Y, as they focus on the vibrancy, design, and atmosphere of the hotel rather than the typical luxury and relaxation.”
The tourism authority is determined to develop Bahrain as a natural tourism destination, which will allow it to move away from being solely dependent on Saudi Arabia and attract diverse source markets from across the globe, which will in turn boost the country’s image and create demand for hotels in the kingdom.
Bachar explains: “Hawar Island, one of our largest natural islands, which was not developed, is now being developed as an eco-destination. It has a lot of natural aspects to it, it is home to an annual bird migration. There are a lot of animals that live on the island, and Edamah is developing the area. They are looking at eco-resorts and they are targeting operators who specialise in that space.”
The Ritz-Carlton, Bahrain executive assistant manager sales and marketing Soufiane El Allam says: “Bahrain’s tourism industry is developing year-on-year, but the demand remains a constraint. The onus now lies with hotels to create the demand and to grow new source markets. We at The Ritz-Carlton, however, pledge to always create the demand and look forward to endless possibilities.”
He concludes: “Bahrain’s scenery has always been vibrant that is why more international hotels are opening in the city, but the demand is not matching the supply. For the next one year we remain bullish about the market. 2018 is looking slightly similar to 2017 but we are expecting a lot more business coming in. With BTEA opening new offices worldwide, I am certain that we will reap more benefits in the next 12 months.”
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