Rotana CEO: Last-Minute Gulf Bookings Make Q4 Hard to Predict
Rotana CEO Philip Barnes warns that narrowing booking windows in the Gulf region amid the U.S.-Iran war make Q4 forecasting difficult.
Stock photo for illustration only, not from the actual event
- Rotana's Q4 forward bookings are significantly lower than last year's levels.
- Shortened booking windows render traditional forward data unreliable for forecasting.
- Regional room rates are down 5% to 8%, with no strong recovery expected until Q2 2027.
- The hotel group maintains its expansion pipeline with about 40 properties in development.
Abu Dhabi-based hotel group Rotana has cautioned industry executives against placing too much reliance on current reservation figures, as booking windows across the Gulf have narrowed sharply amid ongoing uncertainty from the U.S.-Iran war. Although forward reservation data currently appears weak, hotel leadership notes that historical patterns from earlier months suggest actual performance can significantly outperform advance numbers.
Philip Barnes, Chief Executive Officer of Rotana, stated that business on the books for the fourth quarter is dramatically below the levels recorded at this time last year. However, he pointed out that forward bookings for August and September were similarly minimal, yet both months ultimately delivered strong performances. Consequently, these metrics do not reliably indicate how the quarter will unfold, and the regional market remains in an unpredictable state until conditions stabilize.
Stock photo for illustration only, not from the actual event
"Business on the books for Q4 is dramatically below last year’s levels. But our business on the books for August and September was also minimal, and those two months performed well."
Philip Barnes
Regarding source markets, Barnes noted that travelers from Russia and Germany are beginning to return, making both nations vital focal points for Rotana, though volumes have yet to recover to pre-war levels. Visitors from China and India are also providing substantial support to the region. Highlighting the extreme short-term nature of current reservations, Barnes mentioned that one Rotana property recently secured a booking for 45 German tourists with only two days' notice.
The phenomenon of shrinking booking windows illustrates shifting traveler psychology and heightened caution regarding regional stability in the Middle East. Guests increasingly delay booking decisions until the last minute, forcing hospitality operators to abandon traditional forecasting models and rely instead on alternative revenue drivers such as extended stays, domestic staycations, and corporate meetings, incentives, conferences, and exhibitions (MICE) to sustain occupancy levels.
In terms of operational performance, Rotana's portfolio occupancy currently sits in the low 70s, down from the high 70s recorded a year earlier, while Abu Dhabi and Dubai continue to hold near 80%. Pricing remains a more persistent challenge, with regional room rates down 5% to 8% and no meaningful market recovery anticipated by Barnes until the second quarter of 2027. Following a loss of two full months of business during March and April, Rotana expects its profitability for 2026 to reach approximately 80% of the previous year's figures.
Despite these headwinds, Rotana successfully avoided layoffs and hotel closures throughout the downturn. The group has kept its development pipeline intact, including plans to open three new properties in Saudi Arabia within a 12-month window and a total pipeline of roughly 40 hotels across the Middle East and Africa, despite rising construction costs and potential timetable adjustments. Meanwhile, Stephen Dutton of Euromonitor projects that the United Arab Emirates will require two to three years to return to pre-crisis demand due to the heavy reliance of its economy on tourism, whereas Saudi Arabia could bounce back as early as next year driven by domestic and religious travel.
Source: Skift
Found something wrong in this article? Report an issue with this article
Comments
Leave a Comment