Several cities report considerable growth on last year - led by Beirut where revPAR at the hotels sampled are recorded up almost 20 percent, driven by 13 percent growth in volume and six percent growth in average rate. Other cities to experience revPAR growth include Kuwait (up 10 percent) and both Riyadh and Manama (up nine percent). No doubt some of this growth, which in main is volume driven, comes from activity related to the military build-up in the area. Indeed, it is surprising to note that in Kuwait, known for its unique approach to room rate pricing, the average rate has actually dropped despite 14 percent growth in demand. But, and its a big but, this decline takes average rates down from sky high US$183 to US$177, a price that is comfortably the highest in the region.

The other city to enjoy strong growth in revPAR is Makkah where results to end of November (still in the Ramadan fasting period) were 11 percent higher than last year. Interestingly, there appears to have been a much higher number of religious visitors this year - occupancies in this city have reached 48 percent year-to-date compared to 43 percent last year. 

But in other parts of the Middle East the picture is of yet lower revPARs.  The worst performing market in the year-to-November 2002 is west of Cairo at the Pyramids where average rates have collapsed 45 percent in US dollar terms (and 36 percent in Egyptian Pound terms). The price war in the area has had little impact on volumes which are up to just 59 percent from 56 percent, so these hoteliers are looking at a price for this war of revPARs down almost 42 percent. Perhaps it need not have been so bad - hotels in other parts of Cairo have taken a small diminution in volume but held the rate declines to about 17 percent. Bad, but not the carnage at the Pyramids.

Further south in Egypt, the picture is little better than at the Pyramids; hotels in Luxor report revPARs down 37 percent. The hotels in this city report the lowest revPARs of the region at just US$14 year-to-date. 

Compare this, dear reader, to the success of Jumeirah Beach as a destination; revPARs in this location are US$111 year-to-date (the highest in the region), and this on the back of occupancies that have climbed again this year to just short of 80 percent. Indeed, Dubai enjoys easily the highest occupancies in the region at 78 percent. Can the enfeebled Egyptian hotel industry ever expect to regain share against such a strong competitor - only time will tell?

Deloitte & Touche is the UK practice of Deloitte Touche Tohmatsu, a global leader in professional services with over 98,000 people in 140 countries. The dedicated Travel, Tourism, and Leisure practice serves owners, investors, operators and developers throughout Europe, the Middle East, India and Africa. 

Authorised by the Financial Services Authority in respect of regulated activities.  The information contained in this article is correct at the time of going to press.