For many years now, Lebanon has been battling unrest and impending threats — a result from the spillover from the Syrian crisis and other neighbouring countries. The unpredictable political and economic landscape has had a direct impact on the country’s tourism and hospitality sector which used to once make up nearly a fifth of the country’s gross domestic product (GDP).
But off late, with international visitors choosing to visit Beirut again and a steady rise in demand in 2017 has resulted in an optimistic outlook for the country which has a lot to offer in terms of historical sites and natural attractions. In fact, Rotana Hotels & Resorts corporate vice president — sales Declan Hurley states that “2017 has been described as the country’s best year for tourism since 1951”.
“The travel and tourism industry in Lebanon witnessed an amazing rebound in 2017 despite a challenging backdrop. In fact, 2017 has been described as the country’s best year for tourism since 1951, with the sector’s contribution to economy recorded at 18.4%, which is expected to increase further by 5.2% in 2018, according to figures by the World Travel and Tourism Council (WTTC).” Hurley points out.
The positive demand in the landscape is reflective within the hotel market as well, according to TRI Consulting director Christopher Hewett. Lebanon received 1.9 million visitors in 2017 which was a 10% rise compared to the visitor numbers in 2016.
However, despite the growth in occupancy rates, Hewett notes that the other key performance indicators (KPI) such as average daily rates (ADR) and revenue per available room (RevPAR) for the Lebanese hotel market in 2017 did not demonstrate values that were directly proportionate.
“Although this growth in visitors resulted in higher occupancy levels, the market was not able to convert the higher demand into stronger room rates as ADR fell 12% driving RevPAR levels down by 5.2% to US $42,” Hewett explains.
According to STR, the current hotel market has 96 existing properties with 9,429 rooms, and has one property — which amounts to 158 rooms — in the pipeline. This accounts for a 1.7% growth in the industry.
In the first quarter of 2018, STR reported 48.7% occupancy rate compared to the same time period in 2017, ADR was registered at $143.64 which reflected a negative 0.8% change from Q1 2017 and $69.89 RevPAR was generated, which was a 0.9% dip compared to the Q1 2017.
Rotana currently operates two properties in Lebanon including the five-star Gefinor Rotana in the central Hamra area that has 159 keys, as well as the four-star 175-key Raouché Arjaan by Rotana located in the heart of Beirut.
The properties, Hurley states, performed well regarding occupancy, but the hotels faced downward pressure on ADR. The two hotels reported an average occupancy of 74.7% in 2017, an average ADR of $108.9 and an average RevPAR of $81.2.
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Even though the hotel pipeline has hit a bit of a slump and there are concerns and questions regarding safety and security for prospective visitors, the country, Hewett says, has managed to rope in tourists. “Although the market was impacted by the initial challenges of the neighbouring conflicts, Lebanon’s tourism sector has remained resilient and continues to attract an increasing number of international visitors,” he adds.
As a matter of fact, visitors from Europe were the largest source market in 2017 with 33% of visitors, however this was closely followed by Arab visitors at 28% and travellers from the US at 17%.
Hewett points out that upon the review of the hotel segment performance, travellers from the ‘best available rate’ (BAR) segment generated the highest demand with 30% of the rooms nights in 2017, followed by the corporate at 26% and leisure segment registered at 20.5%. Tours and groups increased 15% during the year and reflects the growth in international leisure visitors.
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