Tuesday 23 April 2024

Saudi hospitality sector posts solid growth in 2023

RIYADH, February 28, 2024

Saudi Arabia’s hospitality indicators have mostly outperformed their 2019 baselines with the kingdom’s ADR (average daily rate) improving by 12.3%, leading to a 18.9% increase in RevPAR (revenue per available room), according to CBRE, a global real estate advisory firm. 
For the full year 2023, compared to 2019, Saudi Arabia’s average occupancy rate recorded a 3.5 percentage points increase, it stated.
On a city level, in the year to 2023, Riyadh gained a 3.1 percentage points increase in its average occupancy rate, while its ADR expanded by 17.5% leading to a 23.5% increase in RevPAR. 
In Jeddah, the average occupancy levels saw a hike of 7.0 percentage points accompanied by a 0.4% growth in its average daily rate culminating in RevPAR growth of 12.9%, stated the expert. 
According to CBRE, Makkah and Madinah persisted with the positive performances seen over the year with average occupancies rising by 3.9 and 5.6 percentage points, and their average daily rates registering growth of 21.9% and 35.3% respectively. 
As a result, Makkah and Madinah witnessed RevPAR growth rates of 29.8% and 46.6%. In Khobar we saw the average occupancy rate expanding by 7.5 percentage points while its ADR declined by 5.0%, resulting in its RevPAR improving by 8.1%, it stated. 
In Dammam, the average occupancy rate rose by 7.5 percentage points while its ADR softened by 1.6% leading to an overall increase in RevPAR of 13.1%, it added.
"On the whole, demand in Saudi Arabia’s continue to severely outpace supply across almost all real estate market sectors, hence, we have seen relatively strong levels of performance in 2023, despite some headline economics headwinds," remarked Taimur Khan, the Head of Research (Mena).
"In 2024, whilst supply across many sectors is set to expand, we expect that it will still continue to lag demand materially, as a result we expect that performance levels will remain robust throughout the year," he added.-TradeArabia News Service


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