According to Ernst & Young Middle East hotel benchmark survey, the occupancy rate in Beirut’s 4- and 5-star hotels reached 48.7% percentage points (pp) by December 2022, up from last year’s percentage of 42.3% while the average room rate in dollars currency has increased by 5.8% to stand at $46 by December 2022.
On a monthly performance, Beirut occupancy rate slightly increased by 1.9% in December 2022 to reach 42.2%, compared to an occupancy rate of 40.2% in December 2021. Furthermore, although Beirut occupancy rate during the holiday season was higher than during the previous month of November at 39.3%, however it remains lower than in August at 64% and in July at 75%. In addition, the average room rate in dollars has decreased significantly by 24.6% from $72 in December 2021 to reach $54 in December 2022, whereas in the Lebanese pound, average room rate has increased by 17.8% to reach LBP 2,280,026 in December 2022. In turn, RevPAR (Revenue per available room) decreased by 21.1% in USD during the same period: $29 in December 2021 to $23 in December 2022 while in Lebanese pound, the RevPAR added 23.4% to stand at LBP 961,275 in December 2022.
On a regional level, the occupancy rates in Dubai overall increased by 8.9% yearly to 72.5%. By the same token, the Average room rate and Room yields both increased by 19.9% and 36.7% to stand at $339 and $246, respectively by December 2022.
Furthermore, in KSA, Makkah and Madinah’s hotel occupancy rate increased respectively by 40.5% and 31.4% to reach 67.4% and 74.4% in December 2022; whereas, Riyadh’s and Jeddah’s hotel occupancy rate increased respectively at a slower pace of 4.2% and 6.4% to reach 62.9% and 55% by December 2022. Interestingly, the average room rate reached the highest value in Jeddah at $237 by December 2022, followed by Riyadh and Makkah where the average room rate reached respectively $180 and $165 by December 2022. In fact, in 2022, post Covid-19 pandemic, Saudi Arabia and specifically Makkah region, has benefitted to a great extent from a huge boom in tourism as they welcome more than one million pilgrims to the Hajj.
Moreover, in Muscat, occupancy rate added 20.8% to reach 52.3% by December 2022, average room rate increased by 33.3% to reach $126 per night; likewise room yield grew by 121.3% to reach $66. Meanwhile, in Doha occupancy rate contracted by 14.2% to reach 60% by December 2022, while average room rate increased by 68.9% to reach $166 per night and room yield grew by 36.6% to reach $100.
Despite favorable Mediterranean weather in Lebanon and cheaper tourism cost, Gulf countries attract much more tourism activity than Lebanon. For example, Dubai, Abu Dhabi, and Madinah enjoy the top three highest occupancy rates amongst Arab cities. It is our belief that due to political instability in Lebanon, the country welcomes mainly expats in the high season of Christmas holidays and summer.
Source: EY, BlomInvest