Quarterly Report Qatar Q3 2024: Hospitality Market Overview

Improved occupancy and revenues evident due to increase in tourist numbers throughout 2024

Hotel performance has been boosted somewhat in recent months by the increase in tourist numbers to Qatar. While Q3 was subject to the usual fall in arrivals due to the high summer temperatures, the official figures for the first six months of the years reflected a record number of tourists arriving in the State of Qatar.

According to the Planning and Statistics Authority (PSA), more than 2.6 million people visited Qatar in the first half of 2024, which was an increase of 28% on the previous record of visitors during H1 – achieved last year.

Saudi Arabia remains Qatar’s largest source market for visitors for Qatar with 29% of overall arrivals. In total, 45% of visitors come from the GCC. India represents the second biggest market at 8% of total visitors.

As the tourism sector grows, the pace of new hotel development has slowed after a decade of strong growth. Fewer than 1,000 hotel keys have been delivered over the past 12 months. This compares to an average of more than 2,800 keys per annum between
2014 and 2023. Total supply is now just shy of 40,000 keys including hotel rooms and hotel apartments. Approximately 90% of hotel rooms in Qatar are classed as four star of five-star, with most apartments being classed as ‘deluxe’.

The impact of increasing visitors and a relative slowdown in additional supply is reflected in the performance metrics this year. According to STR Global who compile international hospitality sector statistics, overall occupancy for the year to date (Jan-Sept) in Qatar is 66.0%, which is up from 53.7% in 2023. The ADR has increased from QAR 407 to QAR 431 over the same period.

The improved performance witnessed throughout Q1 and Q2 continued in Q3. Hotel occupancy for September 2024 was 63.4%, up from 57.7% in September 2023. Average Daily Rates in September increased from QAR 359 in 2023 to QAR 380 this year.

The improvement in hotel performance in 2024 is encouraging for the sector and illustrates the benefits of Qatar hosting an increasing number of international events, such as the Asian Cup, Formula 1, and Web Summit. Despite increasing revenues and occupancy, the market remains challenging and will require sustained government investment in the sector as Qatar looks to become established as an internationally recognized destination for leisure tourism and events.

Cushman & Wakefield Quarterly Report Qatar Q3 2024

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