| Journal: TWUK | Section: |
| Title: | Issue Date: 28/08/00 |
| Author: | Page Number: 28 |
| Copyright: Other |
New research
Rates kept low as hotel count in Middle East begins to climb
Report by LEE WINTER
BOOMING economic conditions are continuing to boost hotel development in the Middle East but increased competition will mean room rates will stay low, according to a new report.The Middle East Hotels Trends and Opportunities study carried out by industry analysts HVS International, claims 38,000 hotel rooms will be built across the region by 2005.
But it warned that as more hotel players enter the market, profits will suffer.
Bass Hotels and Resorts currently has 33 properties under development, Starwood Hotels and Resorts has 19 hotels on the way, while Hilton has 10. Marriott International and Le Meridien both have eight new hotels under construction.
The report also tips new brands including Courtyard by Marriott, Sol Melia and Westin to enter the Middle East market this year for the first time.
HVSInternational senior associate Gerard Greene said room rates in growth areas like Egypt, Israel and Jordan will remain low in comparison to other parts of the world.
“A lot of money is being spent out there by developers but it is supply-led demand. A lot of hotels are being built but with rooms that are sold at a minimum. The room rates are very low,” he said.
In Jordan’s Amman, for example, room rates fell by 12.5% to $71 last year following the arrival of a 316-room Hyatt, a 209-room Holiday Inn and a 124-room extension to the Inter-Continental.
More pressure is expected in Amman over the coming months with new hotels from Starwood and Four Seasons and extensions at the city’s Le Meridien and Marriot branded hotels.
Meanwhile HVS reports that 8,500 hotel rooms are set to be built between 2000 and 2005 in Sharm el Sheikh, Egypt, a 150% increase on last year’s levels.
Israel: room rates in growth areas are predicted to remain low in the face of growing competition