Strong performance continues to be seen in the UAE’s hospitality segment of the market on the back of strong visitation levels in Q3 2023, according to top real estate services company CBRE.

 

Globally, the average number of daily flights stood at 119,934 in the year to date to the third quarter of 2023. This figure currently sits at 3.8% above its 2019 level, outperforming its pre-pandemic baseline for the third consecutive quarter. 

 

In August 2023, data from IATA revealed that the Passenger Load Factor (PLF) reached 84.6% in August 2023, marking a drop of 1.1% from the 2019 comparable figure. The available seat-kilometers (ASKs), over the same period, remained below their 2019 benchmark by 3.1%.

 

Strong levels of visitation continue to be seen in the UAE’s hospitality segment of the market. In the year to date to August 2023, the number of hotel guests in Abu Dhabi registered an increase of 33.0% from the year prior, reaching 2.9 million. 

 

Over this period, Dubai hosted a total of 11.1 million international visitors, marking a 21.7% growth compared to the year prior and a 2.3% increase from the 2019 pre-pandemic figures.

 

The average occupancy rate within the UAE grew by 4.8 percentage points, year-on-year, in the year to date to September 2023. Over this period, although the country’s ADR declined by 1.2%, we saw the average RevPARs increase by 5.6%. 

 

Despite this softening in ADR levels on an annual basis, in the year to date to September 2023, the average ADR across the UAE stood at 17.0% above the 2019 benchmark. This growth has been underpinned by elevated ADR levels in Sharjah, Dubai, Ajman, Abu Dhabi, and Fujairah, which have recorded ADR growth rates of 18.2%, 16.1%, 16.0%, 15.7%, and 4.7%, respectively. 

 

As a result, we have seen these locations’ RevPARs outperform their 2019 figures by 27.8%, 21.0%, 28.6%, 13.8%, and 25.1%, respectively. In terms of occupancy rates, most of the cities currently sit above their pre-pandemic levels, except Abu Dhabi, which remains below the 2019 baseline by 1.2 percentage points, said the CBRE in its report.

 

Taimur Khan, Head of Research – Mena at CBRE in Dubai, said: "The UAE’s hospitality sector continued to register strong visitation levels, occupancy rates and RevPAR figures in the third quarter of 2023, a trend which is expected to be maintained on the back of several upcoming events that are anticipated to continue to drive demand and performance over the remaining portion of the year." 

 

Strong visitation levels are anticipated during the last quarter of the year, given the start of the high season and a number of upcoming key events, such as the Abu Dhabi F1 Grand Prix and the COP-28 conference, which will likely be positively reflected in the industry’s KPIs, he added.-TradeArabia News Service