Doha faces risk of hotel over-supply
Doha (Qatar) is facing the risk of oversupply as the hotel market gears up for the FIFA World Cup 2022, according to a new report by Colliers International. It said the city’s hotels are finding it increasingly difficult to maintain a stable revenue per available room (RevPAR) as the incoming supply is putting downward pressure on market-wide rates.
“The announced forthcoming supply of hotels primarily consists of luxury/upscale properties, widening the existing gap in the market for midscale and economy hotels,” the Colliers report for Q3 2013 added. Corporate tourism is the primary driver for hotel demand in Doha, accounting for 65 percent of total demand, while meetings, incentives, conferences, and exhibitions (MICE) is the second largest segment with a eight percent share.
Earlier this week, a senior official responsible for organising the FIFA World Cup 2022 in Qatar said that the event will attract 1 million international visitors to the Gulf state. Hassan Al Thawadi, secretary general of the Qatar 2022 Supreme Committee, also said that the country would not discriminate against any visitors. If Al Thawadi’s forecast is correct, the figure of 1m represents more than three times as many as the 310,000 international visitors that FIFA said travelled to South Africa for the 2010 tournament, but less than the 2006 event in Germany which drew more than 2m.
It is predicted that Qatar will spend up to $200bn on new infrastructure in preparation for the prestigious soccer event, but the decision by FIFA to award the World Cup to the oil-rich Gulf state in 2010 has caused considerable controversy. Concerns include the impact of summer temperatures in the country. FIFA president Sepp Blatter has already expressed a preference for moving the tournament to the winter, although such a move could lead to legal challenges from countries that made rival bids, as well as European domestic leagues that would likely suffer disruption.