Rezidor reports significant drop in UAE market
Saudi Arabian market remains strong in spite of global declines
The UAE performed badly for The Rezidor Hotel Group during quarter two with a 40.5% decline in RevPAR and a 19% fall in occupancy.
However, the company insisted the Middle East, Africa and other* (MEAO) emerging markets remained strong showing a decrease in RevPAR of 15.2%, compared to Europe, where RevPAR fell by 22.9%.
Significant drops in like-for-like occupancy were seen in all global segments; the worst performers including Switzerland (ca -23%), the Baltics (ca -20%), South Africa (ca -18%) and Russia (ca -17%).
However, the best performing market, based on RevPAR development, was Saudi Arabia showing an increase of 11%.
The poor performance of the UAE market was attributed to lower leisure individual and group volumes. Yet, despite the decline in underlying business, fees noted a marginal increase partly due to ramping up of new hotels. According to the report, more than 9725 rooms within 39 hotels are in development across the group's MEAO* markets.
Up to “84% of new rooms contracted this year [by Rezidor] are in Eastern Europe, the Middle East and Africa. A major part of our total pipeline, close to 75% is also in these emerging markets”, said president and CEO Kurt Ritter.
“Despite the downturn, we seek profitable opportunities and continue to reduce risks by adding fee-based managed and franchised rooms to our portfolio,” continued Ritter.
He claimed that in 2009 the company had added more than 3100 new rooms to operation, 87% of which were fee-based. Up to 5000 new hotel rooms were added to the pipeline, bringing the number of rooms in development globally to 23000 — 90% of which are fee based.
*Middle East, Africa and other (MEAO) includes Angola, Bahrain, Brazil, China, Egypt, Ethiopia, Jordan, Kenya, Kuwait, Lebanon, Libya, Mali, Morocco, Mozambique, Nigeria, Oman, Saudi Arabia, Senegal, South Africa, Tunisia, the UAE, Qatar and Zambia.