May 10, 2021

Quarterly Report Qatar Q1 2021: Hospitality Market Overview

Occupancy rates continue to feel the effect of COVID-19 restrictions on travel

Last year, Qatar’s tourism sector enjoyed a solid start to the year
with a 33% increase in y/y performance in January and
February; however, the industry was significantly damaged by
the onset of the COVID-19 pandemic in March. A 73% decline
in visitor numbers resulted in a 18% fall in occupancy rates and
a 22% fall in revenue per room over the entire year.

As the pandemic continued into its second year, PSA data
showed a y/y fall in occupancy in January 2021 by 13% to 53%
but occupancy recovered to 66% in February – comparable with
the pre-pandemic levels in February last year.

According to the National Tourism Council (NTC)’s annual
report, ADRs for hotels in Qatar were QAR 360 and QAR 371
for the first two months of 2020, which mirrored 2019
performance. These rates significantly dropped following the
introduction of lockdown measures in March; however,
revenues recovered during the year due to a surge in domestic
reservations after lockdown measures were eased. Statistics
released by the PSA show that ADR’s for the first two months of
2021 averaged QAR 364, matching pre-pandemic levels.

Several hotels throughout Qatar have been used as quarantine
facilities for people travelling to Qatar, temporarily reducing the
overall supply of available rooms.

According to the NTC annual report for 2020, the overall supply
of hotel keys in Qatar (including hotel apartments), is 28,300
(33,208 rooms). Cushman & Wakefield estimate that almost
20,000 hotel keys are at various stages of planning and
construction, with most expected to complete before the FIFA
World Cup kicks-off in November 2022.

The resumption of diplomatic ties in the GCC is a welcome
development for the hotel sector in Qatar. Before the
introduction of the blockade, visitors from GCC countries made
up almost 50% of arrivals to Qatar. While we expect to see a
significant boost in visitor numbers, particularly from Saudi
Arabia, any potential return to pre-blockade performance is
unlikely until COVID-19 vaccinations are at a more advanced
stage and quarantine restrictions are eased throughout the
region.

The recovery in tourist numbers to Qatar, post-pandemic, is
likely to be focused on the delivery of new resorts, attractions,
and leisure facilities. The importance of leisure tourism to Qatar
has increased over the past year as the increasing reliance on
online meeting facilities is likely to have a prolonged impact on
global and regional business travel.

Cushman & Wakefield Quarterly Report Qatar Q1 2021

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