Hotel occupancy in Hurghada and Sharm El Sheikh is growing, and this trend will continue throughout 2018. According to a report by the international company Colliers, in the first quarter of 2018, hotel occupancy and average revenue per available room (ADR) in all key cities of Egypt (Cairo, Alexandria, Hurghada and Sharm el-Sheikh) has grown compared to the same period in 2017, reports ATOR.
Sharm el-Sheikh was the "champion" in terms of growth, showing the greatest growth compared to 2017 (+441 TP3T). By comparison, hotel occupancy in Hurghada increased by 281 TP3T, Alexandria by 91 TP3T, and Cairo by just 31 TP3T.
Analysts attribute such strong double-digit growth at Red Sea resorts to the low base effect of previous years. According to Egyptian hoteliers quoted by local media, the average occupancy rate for hotels in Sharm el-Sheikh is estimated at 35–401 TP3T, while in Hurghada it's 50–551 TP3T.
According to Colliers forecasts, Sharm el-Sheikh hotel occupancy rates will be 231+ rooms per night (TPN) higher than 2017 levels for the year, while Hurghada's occupancy rate will be 151+ rooms per night (TPN). Meanwhile, Alexandria hotels will maintain occupancy rates at last year's level, while Cairo hotels will see an increase of 31+ rooms per night (TPN).
Regarding hotel revenue, ADR in Sharm el-Sheikh increased by 37%, and in Hurghada by 26%. For 2018 as a whole, growth is projected to be more modest: +11% in Sharm el-Sheikh and only 6% in Hurghada. This suggests that analysts do not expect a significant increase in resort hotel accommodation prices.
As the report emphasizes, Egypt's hotel market is growing primarily due to new hotel openings in Cairo. With 900 new rooms added in the first quarter, the Egyptian capital increased its hotel inventory by 51,000 rooms compared to the first quarter of 2017. Due to the recovery in Egypt's tourism sector, it is projected that approximately 7,000 new rooms will be added to the market by the end of 2020.
Experts say the current period of stability in Egypt has prompted Russia and Germany, two key sources, to resume direct flights to Cairo and Sharm el-Sheikh, respectively.
"If this trend continues, further demand for Egypt's popular tourist destinations is expected," Colliers emphasizes.
Source: trn-news.ru