Doha: Qatar’s hospitality sector has registered healthy growth in the first quarter (Q1) of the year as the country gears up to host the FIFA World Cup 2022 in just few months.
The hotel supply pipeline is expected to deliver over 12,000 more keys with the opening of many new hotels in the current year, according to the latest report released by ValuStrat, a real estate consultancy firm.
The report noted that 12,250 keys are in the pipeline for the remaining quarters of 2022. As per Qatar Tourism, hospitality stock was estimated at 29,386 units (21,689 hotel keys and 7,697 hotel apartments) at the end of 2021.
“The total supply of serviced and hotel apartments (including non-branded projects) is predicted to exceed 10,000 keys. Hampton by Hilton Doha Old Salata and Central Inn Al Sadd opened adding 500 keys to the total supply. Rabban Suites West Bay and Swiss Belhotel Doha were rebranded as Voco Doha West Bay Suites and AMT Mena, respectively,” as per first quarter real estate market report by ValuStrat research.
In terms of year-to-date (YTD) March 2022 hotel performance, total foreign arrivals included 315,831 visitors, expanding by a significant 691 percent as compared to the same period in 2021. Asia and GCC provided 60 percent of total foreign visitors.
Average occupancy of hotel and hotel apartments (excluding keys being used for quarantine) was 58 percent as of March YTD 2022, down 5 percent year-on-year.
Average Daily Rate (ADR) for hotels and hotel apartments stood at QR459, up 14 percent over one year. Supreme Committee for Delivery and Legacy has announced 130,000 rooms are available to accommodate the projected 1.5 million fans for World Cup 2022, the report added.
In February 2022, according to ValuStrat research, hotel and hotel apartments stock exceeded 30,000 keys and the pipeline for 2022 was adjusted upwards to 13,300 keys.
On residential performance, the ValuStrat quarterly review noted: “The median monthly asking rent of residential units was estimated at QR9,000, recording a growth of 3.3 percent quarter-on-quarter, and 2.5 percent over one year. Compared to Q4, 2021, the median rent listed for apartments increased by 3.8 percent. The median asking rent for villas rose marginally by 0.6 percent quarterly”.
“Residential occupancy has been estimated to have reached 80 percent, propelled by short long-term leases by the Supreme Committee for Delivery and Legacy for World Cup 2022 and pick-up in demand from companies looking for staff accommodation,” it added.
Residential stock in Qatar was estimated at 308,000 units with the addition of 700 during Q1, 2022. Two residential projects in The Pearl including a tower, and seven apartment buildings in Lusail, were completed adding 600 apartments.
Ezdan Real Estate announced the launch of 4,000 units across eight compounds in Al Wakrah municipality this year. Barwa Real Estate announced the lease of the Madinatna project, comprising 6,780 apartments in Al Wukair to the Supreme Committee for six months during 2022, and Qetaifan Island North launched the sale of phase 3, consisting of 40 residential villa plots. Dar Al Arkan, a Saudi developer, has launched Les Vagues residences (70 apartments) in Qetaifan Island North to start development post Q2, 2022.
As of first quarter of 2022,ValuStrat Price Index (VPI)- Residential stood at 64.9 points and saw a marginal increase of 0.2 percent quarterly but still 2.3 percent lower than Q1, 2021. The VPI is a valuation-based index with a base of 100 points as of Q1 2016.
Apartments displayed an appreciation in capital values of 1.8 percent compared to Q4, 2021. Capital values in Lusail witnessed the highest quarterly and annual increase of 5.3 percent and 2.9 percent, respectively. The Pearl also experienced a marginal quarterly growth of 0.2 percent.
The villa sub-market experienced a slowdown in the decline of values of less than 0.5 percent compared to Q4, 2021. This indicates that the villa market has stablised. Capital values of villas in West Bay Lagoon and Al Dafna increased between 4 percent and 14 percent. Villas in Ain Khaled/Abu Hamour, Umm Salal Ali and Al Wakrah clusters experienced no change quarterly. Al Thumama and Old Airport saw the highest quarterly depreciation ranging between 3 percent and 4 percent.
Gross yields for residential units increased to 5.9 percent from 5.8 percent in Q4, 2021 driven by growth in yields for apartments (8.2 percent). The price to rent ratio averaged 18.6 years for residential units, 12.4 years for apartments and 21.7 years for villas.
