Mid-Market Matters: MENA Hotels & Resorts regional director Fadi Mazkour

MENA Hotels & Resorts regional director Fadi Mazkour talks about the brand’s plans amidst a growing demand for mid-market hotels in the region

Operators, Mid-market, Mena hotels & resorts, Dubai, Middle east

Could you provide a brief overview of MENA Hotels?
MENA is an acronym for Middle East and North Africa however in our native language it conjures the meaning of harbour or port, the culminating point of a journey. Founded in 2008 by Al Hokair Group, a leading company in the hospitality and entertainment industry within the Middle East, MENA Hotels & Resorts holds a distinctive collection of properties, all of which reflect the heart of Arabian hospitality combined with the collective experience of world-class hoteliers. There are seven hotels presently operating under the MENA Flag: two are in the Al Barsha area in Dubai, one hotel in Amman, two hotels in Jeddah, one hotel in Tabuk and one hotel in Riyadh. In the pipeline, we have six hotels planned to be added to the portfolio by early 2019 and an additional three by 2020. All branded MENA Hotels on the mid-scale concept.

Regarding occupancy levels, ADA and RevPAR, how was the performance in 2017 and so far in 2018? What were the key indicators for the performance?
The performance of 2017 versus 2018 was much better in terms of ADR & RevPAR due to the current local/regional increases in inventory. Dubai has close to 107,000 available rooms and is expecting an increase of nearly 50,000 rooms by 2020. The political unrest in the area has had a dampening effect on some hotel metrics. The oil price crash three years ago has also contributed to the challenging times as a major contribution to the GDP in GCC oil producering countries. In Dubai, even though it doesn’t directly rely on oil, many of its source markets do, and as a consequence a decline in average room rates in the past four years close to 22% was witnessed. Our revenue management team strategy now is to focus on RevPAR and benchmarking to maximise yield and profitability.

How do you believe MENA Hotels & Resorts adds to the existing mid-market pool of hotels in the Middle East?
The mid-market segment is one that is tipped for rapid growth. Luxury hotels in the Middle East have an excellent reputation for attracting a market segment seeking luxury accommodation. However, hotel investors and developers realised that there is a greater need of mid-scale & budget-friendly hotels to attract a larger share of the remaining market segments. MENA Hotels has specifically designed a mid-scale hotel concept with modern lifestyle interiors and technology, attracting new generation business and health conscious travellers where they can obtain affordable room rates, saving their money on discovering city attractions and outdoor tourism.

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What do you think is driving the demand for mid-market hotels in this region?
I think most of room rates in main GCC destinations were amongst the highest in the world when looking for a place to stay.  The average room rate was recorded at $220 plus. They all needed more affordable accommodation, especially when we are looking at new emerging tourist markets such as India, China or even from a rebounding Russian market. We are expecting 2.5 million Chinese tourists to visit the GCC by 2021, a market that many destinations are keen to attract.  Market diversification of providing three and four-star hotel categories offering affordable rates close to $100 or less, became a necessity with an acceptable ROI.

What are some of the challenges and benefits you face as a mid-market hotel brand in the region?
Despite the fall in average room rates, occupancy levels have not actually fallen tremendously in the past three years. It is always about finding demand generators to attract business and tourists to our hotels at an affordable room rates with an added value.

What is your long-term vision for MENA Hotels & Resorts?
Our long-term vision is working on having a hotel or more in almost every major city in the MENA region. A wellness and retreat resort concept is also under completion.

What are some of the upcoming trends you see for mid-market hotels in the Middle East?
Technology driven, simple room designs, a variety of healthy food on the menu and seekers of wellness sanctuaries are some of the upcoming trends for mid-market hotels.

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