Nassau Hotels Hit 34% Room Revenue Increase
The Central Bank’s report on monthly economic developments for May highlighted a buoyant tourism industry through its peak winter season, with Easter maintaining the momentum of double digit increases across all major performance indicators for Nassau/Paradise Island hotels.
“The latest data from The Bahamas Hotel & Tourism Association (BHTA) and the Ministry of Tourism showed a 27.9 percent improvement in room revenue during April, as the average occupancy rate firmed by 5.9 percentage points to 78.5 percent, while the average daily room rate (ADR) increased by 14.8 percent to $304.68,” the Central Bank said.
“Similarly, on a year-to-date basis, total room revenue expanded by 34 percent, with the average occupancy rate advancing by 11.9 percentage points to 77.9 percent. In addition, the ADR firmed by 10.4 percent to approximately $300.”
Despite the feeling among some observers that the benefits of such “double digit” increases have yet to be felt by ordinary Bahamians and the wider economy, the Central Bank added: “Increased visitor traffic for the Easter holiday period sustained the growth in tourism, led by gains in the high value-added stopover visitor segment.
“According to the latest data from the Ministry of Tourism, total arrivals rose by 11.9 percent in April, outpacing the 0.9 percent increase recorded in the corresponding month last year, as hotels benefited from the Easter holiday traffic.
“Specifically, the growth in air arrivals quickened to 18.8 percent from 4.3 percent, and sea passengers advanced by 9.6 percent, a reversal from a slight 0.1 percent reduction in 2018,” the regulator continued. “Underpinning this improvement, visitors to New Providence recovered by 23 percent, a turnaround from 2018’s 10.9 percent contraction, amid gains in both air and sea tourists.
“In contrast, gains in Family Island visitors slowed to 6.9 percent from 31.3 percent a year earlier, as changes in major cruise lines’ port itineraries resulted in a deceleration in sea arrivals’ growth, although the higher value-added air component recorded an upturn over the prior period’s outcome.
“In contrast, conditions in Grand Bahama remained relatively weak, as total arrivals contracted further by 26.7 percent as the decline in calls from major cruise lines, outweighed the air segment’s marginal gain.”
For the first four months of 2019, total tourist arrivals to New Providence jumped by 26 percent while flows to the Family Islands rose by just 1.2 percent due to a “weaker sea volume”. The Central Bank added: “Further, visitors to Grand Bahama contracted by 21.2 percent owing to a fall-off in the cruise segment, which overshadowed the incremental improvement in air arrivals.”
The May report said similar trends to the hotel and wider tourism industry were witnessed in the Bahamian vacation rental market. It added: “Data from AirDNA revealed a 25.2 percent increase in total room nights sold during May, with bookings for hotel comparable and entire place listings firming by 30.8 percent and 24.6 percent, respectively.
“An analysis of the major markets showed that Exuma recorded the strongest growth of 34.7 percent, followed by New Providence (19.3 percent) and Abaco (21.5 percent). However, bookings for Grand Bahama fell by 5.2 percent on account of a decrease in the entire place category.
“In terms of pricing, the ADR for hotel comparable listings contracted by 23.3 percent to $150.43 due to broad-based declines across all major destinations. Similarly, rates for entire place listings narrowed by 6.4 percent to $399.28 with declines in all of the markets—with the exception of Exuma.”
As for air arrivals and departures, May data from the Nassau Airport Development Company (NAD) showed a 15.8 percent rise in stopover departures. “The growth in non-US departures accelerated to 15.1 percent from 11.8 percent, while the dominant US component advanced by 15.9 percent for the second consecutive year,” the Central Bank said.
“Further, over the first five months of 2019, aggregate departures rose by 19.9 percent, extending the 12.7 percent expansion recorded in the prior period as the growth rate for US traffic nearly doubled to 21.6 percent, although gains in the non-US component tempered to an albeit healthy 11.2 percent.”
By NEIL HARTNELL
The Tribune
Published: July 2, 2019
