Hotel occupancy outlook in Cairo + Sharm on the up
Colliers International has revised upwards its 2021 outlook for hotel occupancy in Cairo and Sharm El Sheikh in its latest monthly MENA hotel forecast (pdf). The real estate services company now sees occupancy in Cairo hitting 45% this year, up 66% from 2020, and hotels in Sharm seeing a 37% occupancy rate, up 58% from last year. This is up from its April forecast, which predicted a 40% occupancy rate in Cairo and 35% in Sharm.
Outlook for Hurghada, Alex unchanged: Colliers expects occupancy rates in Alexandria to hit 61% this year, up 35% in 2020, and rates in Hurghada to rise to 38%. These forecasts are unchanged from its April report.
The return of Russian tourists could give these figures a boost: Direct flights between Russia and Egypt are set to resume next month after a six-year hiatus, with 1 mn Russian tourist arrivals expected this year. This should prove a huge boon for hotels in places like Hurghada, which are popular with Russian tourists.
CAVEAT- Even with a huge influx of tourists, hotels still aren’t able to have occupancy rates over 50% due to government restrictions designed to curb the spread of covid.
2021 so far: Hotel occupancy nationwide averaged 40-45% during the first quarter of 2021, and rates have been gradually increasing.
A slow but steady recovery: Last year, occupancy rates in the four destinations dropped almost 60% as the covid-19 pandemic brought tourism to a halt. S&P Global Ratings said this month that tourism will rebound to pre-pandemic levels in 2023, while the government hopes that arrivals will recover to 2019 levels by fall 2022. The government currently expects to receive USD 6-7 bn in tourism revenues this year, which amounts to around 60% of 2019 revenues.