DTZ Quarterly Report Qatar Q4 2017: Hospitality Market Overview
DTZ records indicate that hotel supply approached 25,000 keys by Q4 2017. The most notable new hotels in recent months include the Holiday Inn and Premier Inn, which are located in Airport Road and Education City respectively. These hotels will increase supply of internationally branded mid-market hotels and will target business travelers and tourists with more modest budgets.
Despite the welcome arrival of new 3-star hotels, the market is still dominated by luxury brands. More than 85% of room keys and almost 70% of establishments in Doha are still either 4-star or 5-star. The pipeline of new hotel development remains strong with more than 10,000 hotel rooms and 2,000 serviced apartments at various stages of planning and construction, with the majority being delivered to 4-star or 5-star specifications.
The hospitality sector in Qatar has undoubtedly been impacted by the recent blockade. While official figures for the second half of the year have not yet been released by the Qatar Tourism Authority, statistics released by the Ministry of Development Planning and Statistics in December showed that YTD tourist arrivals had fallen 20% since the previous year, despite the 1.5% YTD increase that had been recorded in June.
According to MDPS statistics, the overall hotel occupancy for November was 57%, down from 70% recorded last year. Average Daily Rates (ADRs) and Revenue per Available Room (RevPARs) were QAR450 and QAR257 respectively in November.
The most recent publication by the QTA for H1 2017 shows official hotel occupancy at 62% for the first six months of the year, a fall of 3% on the previous year. In terms of revenue, ADRs of QAR 450 and RevPARs of QAR 257 reflected falls of 9% and 11% on H1 2016, which can largely be attributed to the increase in competition within the Doha market.
Qatar Tourism Authority recently released its National Tourism Strategy, which set out targets for 2023. Targets include boosting occupancy rates to 72% across the sector, and doubling tourist arrivals to 5.6 million. Qatar recently announced the expansion of visa free entry to 80 countries and the introduction of the e-visa platform.
To attract greater tourist numbers to Qatar, major investment will be required in developing tourist attractions, and adding to the success of initiatives such as Shop Qatar and The Summer Festival.
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