Hotels in Egypt and other countries hit hard by the Arab uprisings are again starting to fill rooms but a full recovery remains a long way off, industry executives said Sunday.
Bookings plunged earlier this year as violent protests gripped Tunisia, Egypt and other sun-kissed Mideast destinations. The drop-off in business stung because tourism is a key source of jobs and cash for those countries in the region that do not have large oil reserves.
Many travelers who did not cross the Middle East off their itineraries altogether shifted travel plans to destinations untouched by widespread demonstrations, such as Dubai and Abu Dhabi in the United Arab Emirates.
Now, hotels and other travel-related businesses scarred by the unrest are scrambling to coax those much-needed tourist dollars and euros back.
“There’s clearly a benefit for Dubai and Abu Dhabi as a result of the instability. In terms of the other countries, the impact medium-term is very hard to guess,” said Mark Wynne Smith, chief executive for Europe, Middle East and Africa for consultancy Jones Lang LaSalle Hotels.
Hotel executives gathered for an industry conference in Dubai said business has begun to pick up for a few struggling Mideast destinations, particularly at the beachside resorts that dot Egypt’s Red Sea coast.
But with occupancy levels and room rates running much lower than usual, they acknowledge it could take until at least next year — assuming the political situation stabilizes — for things to start to get back to normal.
“We do not know the extent of the damage,” Selim El Zyr, president and CEO of regional hotel operator Rotana Hotels, told The Associated Press. “This is the first time (we’ve seen unrest) in so many markets. … Of course it puts us in a situation of uncertainty.”
Rotana manages 42 hotels in nine Arab countries.
El Zyr said its hotels in Syria are suffering through an unprecedented drop in business as the country reels from an uprising challenging four decades of rule by the Assad family. But business is returning in Egypt as the situation there improves.
Rotana’s resorts along the Egyptian Red Sea effectively emptied out when protests erupted in January, leaving only a handful of guests amid hundreds of rooms, he said. The Abu Dhabi-based company runs three hotels in the Sinai Peninsula resort of Sharm el-Sheikh and another in the city of Hurghada.
In part by slashing rates, the chain has been able to get occupancy levels back up to about 50 percent at the hotels, he said. The same hotels were able to fill more than 80 percent of their rooms while charging as much as twice the price a year earlier, he said.
Hilton Worldwide is also starting to see business pick up along the Red Sea, a popular destination for tourists from Europe and the Middle East.
Rudi Jagersbacher, the company’s president for the Mideast and Africa, said Hilton leisure properties along the coast saw occupancy rise to about 60 percent in April. That’s a big improvement over the previous month, but still 30 percent lower than the rate a year earlier.
Getting customers back into hotel rooms in the cities of Cairo and Alexandria — which both witnessed massive protests — remains a much tougher task. Hilton properties there are running about four-fifths empty, he said.
“Confidence in the market still has a long way to go from a Cairo point of view. That’s something that is going to come gradually. I don’t think this is a short fix,” Jagersbacher said in an interview.
He predicts business at the company’s 12 Egyptian leisure resorts could get back to normal by the end of this year, and said he’ll be “really delighted” if trade in Cairo and Alexandria recovers by the first part of 2012.
But he acknowledges that the outlook for other destinations, including Tunisia, are uncertain.
“I think Tunisia is a big question mark, a wait-and-see situation,” Jagersbacher said.