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Cairo’s occupancy levels for next 3 months forecasted at 58%: Colliers International - Daily News Egypt

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Cairo’s occupancy levels for next 3 months forecasted at 58%: Colliers International

No expected recovery for Hurghada and Sharm El Sheikh in the short term


 

Colliers International, The Commercial Real Estate Leader has released The MENA Hotel Forecasts July 2016 report.

Cairo hotels showed a strong performance in the first half of 2016 owing to both corporate and MICE (meetings, incentives, conferencing, exhibitions) activities, in addition to the organic market growth witnessed, according to the report.

Alexandria witnessed strong domestic, leisure demand owing to the summer season and Eid holidays. The momentum of such demand is expected to continue in the next half of 2016, leading to higher average daily rates (ADR) and occupancy levels.

On the other hand, an increased drop in demand was forecast for both Sharm El-Sheikh and Hurghada as a result of the negative sentiment on the part of tourists, which was compounded by travel alerts from various European countries. No recovery is expected in short to medium term.

 

Both Amman and Kuwait City have witnessed a drop in corporate and MICE activities. Nevertheless leisure demand from traditional source markets, such as Gulf Cooperation Countries (GCC) and the rest of the Arab region, will keep the demand in line with last year’s results.

 

Colliers International forecasts Cairo’s occupancy levels for the next 3 months at 58%, with $167 ADR, $96 revenue per room (RevPAR), and a 21% increase in total room revenue divided by the total rooms available (RcvPAR), which is the highest increase in the MENA region.

Sharm El-Sheikh is forecast at 32% occupancy, $47 ADR, $15 RevPAR, and a 63% decrease in RcvPAR; while Hurghada is forecast at 30% occupancy, $56 ADR, $17 RevPAR, and a 62% decrease in RcvPAR.

The forecast for Alexandria shows 78% occupancy, with $102 ADR, and $79 RevPar, with an increase of 11% in RcvPAR.

The report also cites the guest experience index (GEI) data for June 2016. Egypt, which is featured as one of the top three review sources, scored an average rating of 78.92 out of 100.  United Arab Emirates (UAE) came second with an average rating of 77.32, and Saudi Arabia came first with 75.30.

Palm Jumeirah and Abu Dhabi Beach Hotels received the highest GEI scores, followed closely by hotels in Luxor, which has the highest GEI score in Egypt at 86.

Furthermore Hurghada received the second highest GEI in Egypt at 84, followed by Sharm El-Sheikh at 81, Cairo at 73, and Alexandria at 72. A high GEI score is a sign of a strong and competitive market, with good service and hospitality fundamentals.

 

The report is based on actual operating data from a sample of three-, four-, and five-star hotels and quality service apartments around the region.

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