International Hoteliers Continue To Reel From the 9/11 Tragedy

Hoteliers around the world continue to reel from the post-September 11 slump in room bookings, those in the Middle East and Africa have not been spared, with revenue in US dollars declining in all but one market tracked by the Andersen Hotel Industry Benchmark Survey. Analysis of the October results from the Middle East and Africa edition of the survey were recently released by Andersen, the professional services firm and a provider of hotel performance data to the industry outside North America.

Manama, Bahrain, was the only market to record growth in both occupancy and average room rate in the month of October, bucking the general trend, which saw double digit declines in occupancy in 21 of 28 markets. However, Alexandria, Egypt, Muscat, Oman, and Saudi Arabian cities Makkah and Medina and Provincial Saudi Arabia rallied during the month and saw increases in occupancy figures compared to October 2000. Muscat is the only market that has seen consistent increases in occupancy in every month this year.

Manama’s increase in occupancy has resulted mainly from extra military business, but the corporate and Saudi leisure weekend market remained stable. The conference business was negatively affected with significant cancellation of international bookings.

September signaled the start of the winter season for the Middle East and Africa, and hoteliers had anticipated a boom in business. However, the September 11 terrorist attacks, coupled with the continuing conflict in Israel and the war in Afghanistan, have seen travel and tourism to the region plummet. This has led to all but seven markets recording revenue declines for the year to October.

The outlook for the industry in the coming months is difficult to predict due to its dependency on factors beyond the control of the region’s hoteliers. International convention and leisure business continues to be the hardest hit, although corporate business and domestic and intra-regional travel seem to be less adversely affected. In the short-term, hoteliers may find that these latter markets prove capable of replacing lost business, as they wait for consumers to regain their confidence in international travel, and for leisure business to the region to pick up once again.