Ernst & Young launches Middle East Hotel Benchmark Survey

The survey, which has been published by Ernst & Young's Dubai-based Middle East Real Estate, Hospitality and Leisure Advisory Services group, covers occupancy, average room rates, and rooms yield of lodging markets in the Middle East on a monthly and year-to-date basis in both local currencies and US dollars.

The survey findings show that hotels in key regional markets have achieved high occupancy levels in the first nine months of this year - with properties in Dubai recording the highest at 88 percent in 2004, an increase of 10.8 percentage points from last year.


Saudi Arabia has shown mixed results with hotels in Jeddah, Madina and Makkah doing considerably well compared to those in Riyadh, where hotels recorded an 11 percentage point decrease in occupancy levels in the first nine months of 2004 over the corresponding period last year. For September alone, occupancy levels in Riyadh
properties slumped to 57.5 percent from 69.2 percent in September 2003.

The survey has found that in cities like Doha, Dubai, Beirut, Muscat and Sharm El Sheikh in Egypt, hotels made substantial gains in average room rate in the first nine months of 2004, while properties in the Saudi Arabian cities of Madina, Makkah and Riyadh saw a decline in this category. Doha properties posted the highest increase in average room rates during the period of January-September with 18.4 percent compared to the same period last year. While Dubai achieved an increase of 15.9 percent, in Beirut average room rates rose by 13.1 percent and in Sharm El Sheikh they went up by 9.2 percent. Properties in Madinah, Makkah and Riyadh registered a decline in the average room rate with the figures falling by 8.0, 7.7 and 4.7 percent respectively.

Mr. Edward Quinlan, UAE Country Partner - Ernst & Young, said: "As the largest assurance and business advisory firm in the Middle East, Ernst & Young is pleased to publish this significant survey of the hospitality sector in the region. Overall, the survey shows healthy growth in the hotel industry which bodes well for the region's tourism sector."

He added: "Hospitality executives today face a unique set of business challenges that place unprecedented pressure on management. To help meet these challenges, executives need access to the most accurate and up-to-date information from a trustworthy source. The launch of our Middle East Hotel Benchmark Survey will provide reliable information and data, and also establish Ernst & Young as one of the major players in the hospitality and leisure market".

Ernst and Young's Middle East Real Estate, Hospitality and Leisure Advisory Services group is currently assisting regional organizations in the tourism and hospitality sector improve and control the way they manage their investments and operations in real estate assets throughout the entire lifecycle of their property portfolio.

The Advisory Services group is a sophisticated team of professionals from around the world, offering services in strategic tourism enhancement planning, hotel operational reviews, positioning analyses, asset management, management company selection/negotiations, capital sourcing, benchmarking, valuations, mergers and acquisitions, due diligence, and market driven feasibility studies for a variety of asset types. These include mixed-use resort developments, large hotel portfolios, traditional hotels, golf courses and clubs, theme parks, vacation ownership, condominium-hotels, cruise ships, airlines, retail, office, marinas and residential developments.

Mohammed Dahmash, Regional Practice Leader and Partner of the Ernst & Young's Middle East Hospitality and Leisure Advisory Services, declared: "The Middle East Hotel Benchmark Survey is timely, given the number of hospitality and leisure-related projects currently under development. In the future, Ernst & Young will collate hotel profit and loss data from across hotel markets covered in the benchmark survey, to publish profitability surveys on a quarterly basis. As our sample size increases, Ernst & Young will also provide customized Market Share reports for individual properties upon request. The Market Share report compares the performance of an individual property, against the aggregated performances of its competitors in the market".

The Ernst & Young Middle East Hotel Benchmark Survey is planned to be issued periodically and arrangement can be made to obtain it by contacting Mohammed Dahmash on his e-mail address of mohammed.dahmash@ae.ey.com.

Ernst & Young's Middle East Real Estate, Hospitality and Leisure Advisory Services will also provide clients with effective strategies to minimize risk, as well as control expenses, and generally improve overall performance, which in turn can accelerate the creation of bottom line value for any company or organization in the hospitality and leisure sectors.