‘Spring’ Fling: H1 2011 sees return of pre-recession hotel occupancy rates - study

‘Spring’ Fling: H1 2011 sees return of pre-recession hotel occupancy rates – study

With an eyebrow raising Q1 and Q2, will the UAE hospitality sector be as fortunate in the months to come?

July 11, 2011 12:47 by Eva Fernandes

So Cluttons, the real estate specialist, just recently released its market report for Dubai’s Hospitality sector in Q2 2011. The report was filled with a lot of things wise ‘ol Kipp already knew, like the number of hotels have dramatically increased over the past ten years, but there was one thing that stood out to Kipp…

According to the report, monthly occupancy levels for hospitality sector in the UAE for the first quarter of 2011 (86 percent) almost match the levels of the first quarter of 2008.

2008, people, 2008! – Before the embarrassing debt crisis of Dubai was revealed to the world. Granted, of course, the increase is not exactly your definition of a sustainable boost to tourism, seeing as the regional political unrest positively benefited the UAE. And with the regional unrest slowing down, the impact on the hospitality sector is uncertain.

JUST A ‘SPRING’ FLING?

No one agrees with us more than Steven Morgan, Head of Cluttons UAE who notes “occupancy rates and lengths of stay have enjoyed considerable growth. However, to what extent Dubai’s current performance is being buoyed by the recent political uncertainty in the region is not yet known and it is unclear how long this situation will continue. In the short term, Dubai seems likely to out-perform in the tourism market this year.”

Right you are Steve, and with the regional unrest slowing down it remains to be seen how well Dubai’s hospitality sector will fare. Especially when you consider the suffocating summer we are currently enjoying (and better not forget those pleasant dusty blanket sandstorms that plague us from time to time), as well as the more sober month of Ramadan approaching us, there is no doubt that tourism during Q3 isn’t going to be as rosy.

But let us not be party poppers; the take-away point from the Cluttons report for the more optimistically inclined is, of course, that the current surge in tourism has quelled analysts’ fears of a double dip recession for the UAE. But then again, Kipp’s not holding our breath on this one.