Egyptian hotels in different governorates, such as Cairo, Hurghada, Sharm El Sheikh, and Alexandria saw an average revenue per available rooms (RevPAR) growth of 42% in 2018 compared to 2017, according to Colliers International’s MENA Hotel Forecast for 2019.
Colliers said that Egypt’s hotels RevPAR growth is driven by both average daily rates (ADR) and occupancy due to strong corporate, leisure, and MICE activity (meetings, incentives, conventions, and events).
The report’s forecast for the Egyptian market continues to be strong. The Red Sea resorts are expected to continue benefitting from positive security perceptions and returning of tourists from major source markets. The major Egyptian markets are forecasted to see an average RevPAR growth of 11% in 2019 in comparison to last year.
According to the report, Cairo hotels is projected to achieve 9% growth in RevPAR Year-over-Year (Y-o-Y) and estimated occupancy at 77% with $128 ADR and $98 RevPAR, while Sharm El Sheikh hotels’ RevPAR forecast worth $27 with 12% growth in RevPAR Y-o-Y and predicted that occupancy will reach 58% for the full year forecast.
The report elaborated that Hurghada hotels will achieve 13% growth in RevPAR Y-o-Y and 68% occupancy rates, meanwhile the report expected that Alexandria hotel market will register 81% occupancy rates with 10% growth in RevPAR Y-o-Y.
“Amongst the Saudi market, hotels in Jeddah achieved higher performance levels (9% increase in RevPAR) in 2018 in comparison to 2017, mostly driven by the ADR. New supply will enter the Saudi market over the short to medium term, this is expected to put pressure on the occupancy and average daily rates. Jeddah hotel market is forecasted to see an average RevPAR growth of 3% in 2019 in comparison to last year,” the report read.
Dubai’s hotel market is experiencing growing demand from price-sensitive source markets resulting in a drop in average daily rates, adversely impacting RevPAR. The market is forecasted to see similar performance trends in 2019 in comparison to last year, the report noted.
It also highlighted that Abu Dhabi beach hotels experienced relatively stable performance levels in 2018 with an increase in occupancy. The beach hotels in Abu Dhabi are forecasted to see an average RevPAR growth of 1% in 2019 in comparison to last year.