RIYADH: Corporate and business tourism helped drive a 5.9 percent year-on-year rise in average hotel room occupancy rates in Saudi Arabia by the end of the third quarter of 2023, according to consultancy firm CBRE.
This led to an 18.4 percent increase in the average daily rate and a 31.2 percent surge in revenue per available room year-on-year to September, positioning these indicators above their 2019 levels.
In the year to date to September 2023, compared to the same period in 2019, Saudi Arabia recorded a 1.2 percentage points increase in average occupancy levels, a 9.6 percent increase in its alternative dispute resolution, and an 11.8 percent increase in its revenue per available room.
Taimur Khan, head of research in the Middle East at CBRE, said that corporate and religious tourism has significantly underpinned growth in Saudi Arabia’s hospitality key performance indicators in the year to September 2023, in contrast to the previous year.
“Over this period, across the Kingdom, average occupancy rates are 5.9 percent higher, average daily rates sit 18.4 percent higher and the average revenue per available room sits a staggering 31.2 percent higher,” he said.
Khan anticipates that this robust performance will continue for the remainder of the year, especially with events like Riyadh and Jeddah Seasons yet to kick off.
The report highlighted that at a city level, year-on-year in the year to date to September 2023, in Jeddah, the average occupancy grew by 7.3 percent, while its average daily rate softened by 0.1 percent, resulting in a 12.7 percent expansion of Jeddah’s RevPAR.
Khan pointed out that the average occupancy rate in Al-Khobar increased by 7.7 percent, while the average daily rate dropped by 4.9 percent, resulting in a 9.0 percent improvement in RevPAR.
In Riyadh, the report showed that the average occupancy saw a rise of 3.1 percentage points as average daily rates improved by 13.1 percent, culminating in a RevPAR growth of 19.1 percent in the capital.
CBRE’s report revealed that the two holy cities of Makkah and Madinah performed consistently as they concluded the religious high seasons.
Madinah’s average occupancy rate expanded by 10.1 percentage points, with average daily revenue marking a 38.1 percent upsurge, resulting in a RevPAR improvement of 60.8 percent.
As for Makkah, the report noted that the average occupancy rate stood 5.9 percentage points higher, and its average daily revenue rose by 27.2 percent year-on-year in the year to September 2023, leading to RevPAR recording a strong growth rate of 40.6 percent.