Home Business A bumpy ride

A bumpy ride

Lebanon’s hotels did better than expected this year, but aren’t yet in the clear

by Nabila Rahhal

Despite a rocky start, and a few ups and downs early in the summer season, 2014 is shaping up to be a better year than feared by many in the Lebanese hotel industry. With the number of tourists up by 22.6 percent from 2013 in the third quarter of the year, according to figures from the Ministry of Tourism, hoteliers in Lebanon finally had a reason to breathe a small sigh of relief — albeit not a deep one, as operating in Lebanon remains unstable at best and contingent on the security situation in the country.

A sluggish start 

Late in April 2014, and ahead of the summer season, Executive sat with Joumana Dammous Salame, managing director of Hospitality Services, which organizes HORECA, among other hospitality related exhibitions. She conveyed the distress that Lebanon’s hospitality sector — and specifically hotels — has been facing for the past two years, with many hotels operating at half their capacity and some considering closure.

[pullquote]Hoteliers braced themselves for another tough year and put on their creative thinking caps to come up with coping strategies[/pullquote]

The year was indeed off to a bad start, with an unstable internal security situation caused by the bombings in the Dahieh area negatively affecting tourism and causing hotel occupancy rates across the city to drop. Le Gray for example reached a 40 percent occupancy, which they considered a “disaster.”

NGOs and the media

Faced with such conditions, hoteliers braced themselves for another tough year and put on their creative thinking caps to come up with coping strategies to ride out the storm.

Members of the international media and NGOs who were in Lebanon to cover regional political developments became much sought after hotel guests. “One of our strategies in times of crisis was that we targeted the biggest segment of travelers to Lebanon, which was the media people who were here to report on and cover the crisis. We had some TV stations doing live broadcasts from Le Gray for three months,” said Hilal Saade, director of sales for the hotel.

Some hotels have to double their efforts to attract tourists in uncertain times like these

[/media-credit] Some hotels have to double their efforts to attract tourists in uncertain times like these

Indeed, boutique hotels in Beirut also boasted of hosting foreign journalists for extended periods, with Marie-Hélène Moawad of Villa Clara explaining how such guests not only benefitted from good rates but also got to experience the “artistic and cultural side” of Beirut during their work stay.

NGO employees, with their limited per diem stipends, filled a lot of Beirut’s three and four star hotels before sometimes moving to apartments, depending on their length of stay. “We get foreigners from NGOs who stay a month or maximum three, and we offer them long term stay rates. But they either finish their work in Lebanon or rent an apartment because, by then, they need to feel at home,” explained Hisham Razzouk, the manager on duty at the Marble Tower Hotel in Hamra.

Food & Beverage venues in hotels

Another coping strategy adopted by hotels in 2013, which continued in 2014, was to rely heavily on their food and beverage venues to compensate for the decrease in room yields. Le Gray’s Saade explained that normally in the hotel industry, rooms bring in more money than events because the cost of rooms is negligible when compared to food for events, which can reach almost 40 percent of the price.

Still, hotels with large reception halls, such as the Phoenicia — which often has two big functions running simultaneously — can count on their food and beverage revenues to compensate for low occupancy rates. 

A better summer

As the internal situation began to stabilize, and summer rolled in, the occupancy in Beirut’s hotels improved with Le Gray boasting 90 percent occupancy in August, beginning with Eid El Fitr. 

Benefiting from the Ministry of Tourism’s ‘Live Love Lebanon’ campaign, which developed packages aimed at encouraging rural tourism, were guesthouses and boutique hotels in Lebanon’s villages.

As more Lebanese — and especially Lebanese expats — were exposed to their country’s picturesque landscapes through the ministry’s campaign, places such as La Maison de la Forêt, an ecotourism hotel in the forests of Jezzine, boasted of an occupancy rate of 80 percent during weekends — 70 percent of whom were Lebanese — with room rates at around $250.

[pullquote]The trend now is for tourists to wait until the last possible minute before booking their trip to Lebanon[/pullquote]

Cautious optimism 

However, tourists’ confidence in Lebanon remains low, and Saade from Le Grey explained that while previously trips to Beirut were planned months ahead of time to benefit from lower rates, the trend now is for tourists to wait until the last possible minute before booking their trip to Lebanon in order to be sure, as much as possible, of the security situation. “If you ask me in November about the occupancy for Christmas, I would tell you that it is currently negligible but that does not mean it will stay that way. We might be full by then, but that will not show until at least 10 days before the holiday season,” Saade elaborated.

The length of tourists’ stays has also changed and, according to the hotels Executive interviewed, while tourists usually stay for an entire week during the Eid holidays, this year most were satisfied with only a long weekend in Beirut.

Finally, with the continuation of the travel ban imposed on the citizens of some Gulf states, the nationality profiles of tourists to Lebanon are changing. While Saade said they had a good number of Kuwaitis in Le Gray this summer, most of the tourists in the city were Europeans who are working in the Gulf and prefer coming to Lebanon for short vacations or long weekends instead of going home.

As 2014 draws to a close, hotels in Beirut are abuzz with end of year business travelers and events such as product launchings and corporate meetings. But hoteliers in Lebanon are accustomed to expecting the worst, and not wanting to get their hopes up, are going about business as usual.

“Before, we were turning people away because we were full, but in times like these, we have to double our efforts. We need to maintain our relations with our clients, even when we know they don’t have business, so that they don’t go to other hotels when times are good,” said Saade.

Support our fight for economic liberty &
the freedom of the entrepreneurial mind

Nabila Rahhal

Nabila is Executive's hospitality, tourism and retail editor. She also covers other topics she's interested in such as education and mental health. Prior to joining Executive, she worked as a teacher for eight years in Beirut. Nabila holds a Masters in Educational Psychology from the American University of Beirut. Send mail

View all posts by

You may also like