Dubai hotels look to cash in on Eid bonanza

Hotel occupancy rates in Dubai this month were expected to grow strongly from the same period last year because of the Eid Al Fitr holidays. Clint McLean for The National

Dubai hotels are expected to cash in on the planeloads of tourists from the GCC during the Eid Al Fitr holidays.

Saudis and Kuwaitis are likely to account for the majority of hotel guests during the period, according to Rashid Aboobacker, a senior consultant at TRI Consulting.

Room rates in Dubai have been under pressure this year because of the increase in room supply. The emirate has the largest number of hotel rooms under construction in the Middle East and Africa, with 17,358 rooms across 68 hotels, or 10 per cent of total rooms in the region, according to STR Global.

Hotel occupancy rates in Dubai this month were expected to grow strongly from the same period last year because of the Eid Al Fitr holidays, potentially reaching 70 to 75 per cent, up from 50.3 per cent last July, said Mr Aboobacker.

But given the low demand during the first two weeks of the month because of Ramadan and the hot summer season, occupancy levels for this month are likely to be significantly below the annual average.

“Hotel room rates tend to escalate substantially during Eid holidays, with most hotels charging 100 to 200 per cent higher during the week than the average rates,” said Mr Aboobacker.

“Despite the higher rates during the week, we expect the average room rate for July to see limited growth – less than 10 per cent – compared to last year due to the low season during the first half of the month and the growth in rooms supply.”

Last July, the average daily room rate in Dubai reached US$203, according to Hotstats.

Eid holidays and Saudi school holidays allow hotels to charge more. At the Amwaj Rotana on Jumeirah Beach Walk, the hotel is expecting full occupancy during Eid, with about 60 per cent of the guests coming from Arabian Gulf countries, including expatriates in the UAE.

“The room rates have increased during this period compared to Ramadan, and we were running a Dh199 room rate during the period, but these are still not as high as the normal high season from October through December, because it is still the summer season,” said Jasmine Arika, the director of marketing and communications at Amwaj Rotana.

Daily room rates at the Amwaj Rotana this weekend start at Dh1,093 (inclusive of taxes), while a weekend in September costs Dh765 a night with charges.

At the 640-room Al Bustan Centre and Residence, Yasser Moussa, an executive assistant manager, expects the occupancy rate to exceed 85 per cent, up 15 per cent from the Eid Al Fitr period las year, and room rates to increase about 20 per cent.

“Summer is one of the peak periods for us,” he said. “I expect the occupancy rate to be steady until the end of August because of the school holidays in Saudi Arabia, the UAE and other Gulf countries besides events such as Dubai Summer Surprises.”

The Dubai Summer Surprises runs from July 23 until September 5.

Some hotels say they have been affected by the civil war in Yemen and Saudi Arabia’s airstrikes against Houthi rebels.

Jihad Fattouh, an executive assistant manager at First Central Hotel Apartments in Tecom, Al Barsha, says the occupancy level is expected to stay flat at 85 per cent this year, while room rates are similar to last year’s.

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