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Qatar’s hotel apartments achieve surge in occupancy rates

Research suggests that hotels in Qatar are struggling with low occupancy rates, leading them to explore the residential market to improve business performance in 2024

During the final quarter of 2023, the hospitality sector in Qatar experienced an increase in hotel apartment occupancy rates compared to the same period in 2022. This was due to residential tenants being attracted to the convenience and affordability of living in serviced apartments.

According to the Planning & Statistics Authority (PSA), deluxe hotel apartments saw their average occupancy rate jump from 60% in December 2022 to 76% in December 2023, while standard hotel apartments increased from 52% to 73% during the same period.

Experts at hapondo, a property search portal based in Qatar, attribute this positive trend to the competitive prices that hotel apartments are offering to attract a greater share of the traditional tenant market.

Ahmad Al Khanji, CEO and Co-Founder of hapondo said, “When property seekers search for apartment rental, it’s not just about the lowest rent but also value for money that they take into careful consideration. Hotels are already known for great service and facilities, and the offer can become irresistible if the difference were to be small.”

According to the latest Qatar Property Report from Q4 2023, there is only a small difference between the median rent of one-bedroom (1BR) apartments and hotel apartments in areas like Al Sadd and Al Mansoura. The premium for 1BR apartments was 13.3%, while for hotel apartments it was 7.1%.

“This meant that a tenant paying for the 1BR median rent of QR7,000 monthly in Al Mansoura only needed to add QR500 to live in a hotel apartment,” it said.

However, during the same quarter, the median rents of hotel apartments in Salata, Umm Ghuwailina, and Old Airport were actually more affordable than regular apartments. This information was found on the property real estate portal.

“In Umm Ghuwailina and Old Airport, the median rent of a 1BR hotel apartment was 28 per cent lower than a regular apartment. A 2BR hotel apartment unit was 14 per cent more affordable than a traditional apartment,” analysts at hapondo stated.

In Q4 2023, Al Mansoura and Old Airport areas became more popular for apartment rentals on hapondo, moving up to rank 5th and 8th respectively from their previous positions of 7th and 11th.

On the other hand, hotel apartments located in Lusail’s Marina District were found to be significantly more expensive than traditional apartments, with a premium of 42% for a one-bedroom and 34% for a two-bedroom apartment.

Research suggests that hotels in Qatar are struggling with low occupancy rates, leading them to explore the residential market to improve business performance in 2024.

Despite these challenges, PSA statistics indicate that the average hotel occupancy rate in Qatar was 72% towards the end of last year, with five-star and four-star hotels reporting 67% and 75% occupancy rates, respectively.

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