Included in this roundup of news from the MEA region: $500b investment in Saudi Arabia; Q3 metrics; OPEC wants to end cuts; and more.
Each week, Hotel News Now features a news roundup from a different global region. Today’s compilation focuses on Middle East/Africa.
OPEC looking for graceful end to production cuts
Even as officials with the Organization of Petroleum Exporting Countries work to extend production cuts they’ve used to save various commodity-dependent nations from free-falling oil prices, they’re looking for the right way to end those cuts, Bloomberg reports.
The news agency reports “the talks, still at a preliminary stage, are complementary to the cuts and designed to improve their impact in 2018. The group is likely to endorse the outlines of the plan when they meet in Vienna on (30 November), but the full strategy probably won’t be unveiled until later next year, the people said, asking to not be named because the talks aren’t public.”
Middle East metrics drop as Africa rises
Each of the three key performance metrics fell for the Middle East in the third quarter, while metrics saw significant growth in Africa, according to the latest data from Hotel News Now’s parent company STR.
Occupancy fell 2.8% to 60.9% in the Middle East for the quarter, while average daily rate dropped 8.1% to $145.50, and revenue per available room plummeted 10.7% to $88.61. African hoteliers enjoyed a 4.9% increase in occupancy to 61.4% as ADR grew 10.1% to $97.79 and RevPAR jumped 15.5% to $60.
How terrorism affects hotels
STR’s SVP of lodging insights Jan Freitag recently took a look at how terrorism events affected various markets, including Sharm El Sheik, Egypt, and Istanbul, Turkey.
According to Freitag, Sharm El Sheik was one of the hardest hit by terrorism.
“Demand in Sharm El Sheik never recovered,” Freitag said. “This demand drop shows the dramatic impact of terror on a market that is solely focused on leisure demand.”
$500b investment expected for new Saudi city
The crown prince of Saudi Arabia is promising the development of a futuristic city named Neom, which will be funded by $500 billion from the country’s sovereign wealth fund, according to The Wall Street Journal.
The newspaper reports “Prince Mohammed, the 32-year-old crown prince leading Saudi Arabia’s economic-reform plan, described Neom during a panel discussion as a futuristic utopia with technology built into the city from the ground up on a piece of land abutting the Red Sea in the northwest of the country near Jordan and Egypt.”
Deals and development
- Carlson Rezidor Hotel Group signed the 152-room Radisson Blue Hotel, Bishoftu in Bishoftu, Ethiopia. The company also signed two other African deals—the 160-room Park Inn by Radisson Addis Ababa and the 218-room Aso Towers Hotel & Residences Abuja.
- Fattal Hotel Management opened the 74-room Leonardo Boutique Jerusalem Hotel in Israel.
- Rotana opened the 290-room Centro Waha Riyadh, the second Centro property in Saudi Arabia.
- Mövenpick Hotels & Resorts signed the 370-key Mövenpick Hotel Muscat Airport.
- The 152-room Ubumwe Grande Hotel in Kigali, Rwanda will convert to the DoubleTree by Hilton brand.
- City Lodge Hotel Group opened the 147-room Town Lodge Windhoek in Namibia.
- Hospitality Management Holding signed a management agreement for the recently converted 337-room Coral Dubai Al Barsha Hotel.
Compiled by Sean McCracken.