The Malta Independent 12 November 2024, Tuesday
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Occupancy rate in 5-, 4-star hotels down in Q4 2023 when compared to 2019, MHRA survey shows

Isaac Saliba Friday, 16 February 2024, 13:02 Last update: about 10 months ago

The occupancy rates in five- and four-star hotels in the last quarter of 2023 was down when compared to the pre-Covid 2019, while that in 3-star hotels was on the rise, results made public during a Malta Hotels and Restaurants Association event on Friday show.

Michael Zarb, the Policy and Economics Advisory Leader at Deloitte, said that arrivals and guest nights in 2023, the first full year without Covid restrictions, exceeded those of 2019.

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Speaking about occupancy statistics in accommodation, he said that the occupancy for Q4 2023 was down from Q4 2019, most noticeably in regard to five-star hotels.

Occupancy in five-star accommodation during Q4 2023 decreased by 6.8 percentage points from the same period in 2019, with 2023 occupancy being 63.7% compared to 2019’s 70.5%.

In terms of four-star occupancy, 2023 Q4 had a decrease of 3.6 percentage points compared to Q4 2019, with 2023 having 75.5% occupancy compared to 2019’s 79.1%

In contrast, occupancy rates in three-star hotels during Q4 2023 registered an increase from Q4 2019, registering an increase of 6.1 percentage points. Occupancy in three-star hotels for Q4 2023 was 69.2% whilst Q4 2019 was 63.1%

In terms of average daily rates (ADR), Q4 2023 registered an increase of 28.7% for five-star accommodation, being represented as €190 per room. Q4 2019 ADR was at €147.70 per room.

Four-star ADR increased by 17.1% from Q4 2019, coming out to €86.20 per room in Q4 2023 from €73.60 in 2019

Three-star ADR for Q4 2023 was the same as Q4 2019, both being €57.10 euro per room, although there was a year-to-date increase of 7% over 2019.

Zarb said that the majority of hoteliers contacted by Deloitte expect positive results in the upcoming quarter.

He said that tourist arrivals for Q4 2023 reached 768,000, which surpassed Q4 2019 by around 218,000. The number of guest nights in Q4 2023 increased by 389,000 when compared to Q4 2019.

He concluded that tourism expenditure reached €597 million, which is 28% higher than the comparable period in 2019 and also surpassed Q4 2022.

During the same activity, Tourism Minister Clayton Bartolo sauid 2023 proved to be the best year in Malta’s history for tourism.

Bartolo said that it was the best year in terms of tourist arrivals, as over 3 million tourists had visited the country, and that it was also the best year in terms of guest nights spent in Malta as well as the best year in terms of tourist spend in the local economy.

He said that in the past it had taken decades to reach the tourism levels of 2019, but that it has now taken only 3 years to surpass those levels and recover from the Covid-19 pandemic. He added that this is a year less than what was originally planned in the recovery plan and continued that Malta is therefore one of the first European destinations to fully recover and has now even surpassed prior results.

With that in mind, he said that these results put huge responsibilities on the government, the public, and the private sector. He added that there needs to be a continued effort for innovation and to market Malta in order to stay ahead of the game.

The Tourism Minister emphasised that throughout this year and the coming years, focus needs to be placed on charting the course of Malta’s tourism industry, particularly in relation to attracting higher-quality tourists.

He said that this can be done by strengthening hospitality, improving public cleanliness, integrating sustainability practices, and preserving the country’s heritage. He continued that a focus on enhancing the tourism offer, high standards of accommodations, unique experiences, and considering quality and quantity as factors that need to work hand-in-hand is important for attracting higher-quality tourists.

This is why the government is introducing the skills card, he said, adding that this is being done to address legitimate concerns about services and raise the quality of services.

In terms of public cleanliness, Bartolo said that the government has invested in equipment to improve in this regard and that it is also implementing a national project which is intended to become a yearly project. He said that there is recognition of the need for better upkeep in tourism zones and that crucial changes are upcoming within a few months’ time which will lessen the abuse that some tourism areas experienced during the summer of 2023.

He referred to air connectivity as “the lifeline of the tourism industry”, and said that this represents Malta’s openness to the world.

The minister said that a meeting with British Airways had recently been conducted which will result in 2 more weekly flights between Malta and the United Kingdom during the upcoming summer. He said that therefore connectivity with the UK will be greatly improving, and that further negotiations with airlines for better connectivity are expected.

Part of these negotiations will be for better connectivity during the winter months, he remarked, which he said would ensure that the Malta Tourism Authority’s marketing is complemented by effective year-round connectivity. He added that investment is being done in regard to the United States, Japan, Australia, and the Gulf countries. He said that the importance of these markets cannot be overstated, as their spending power is important for the industry’s growth and sustainability.

The Tourism Minister concluded by speaking about the importance of preserving cultural heritage, and said that the island’s traditional charm is “here to stay and will be preserved”.

Carlo Micallef, the CEO of the Malta Tourism Authority, said that Italy, Poland, and France had the largest absolute increased in arrivals when compared to 2019. He added that the UK, Italy, and Germany had the largest numbers of repeat visitors.

He detailed the extensive marketing programs being utilised in different countries to target the different markets. He remarked that 27,000 of the 3 million tourist arrivals were overnight cruise passengers.

The MTA CEO cited climate change, balance of supply and demand, and expanding long-haul markets as challenges within the tourism industry. He said that due to certain challenges, the MTA is focusing on long-haul markets that do not need a Schengen visa to travel to Malta.

Also speaking at the event was the President of the MHRA, Tony Zahra, who remarked that it is good that everyone can sit down together and talk, referring to the Minister and Shadow Minister for Tourism both being present at the event.

He said that looking forward, connectivity is the first and most important thing along with public cleanliness.

The MHRA President had a message for Michael O’Leary, the CEO of RyanAir.

“We have done more for RyanAir than RyanAir has done for us,” he said, saying the Irish businessman should respect his hosts “We come from the same colonial past,” he continued, “don’t try to be a coloniser. Don’t consider us as being stupid, because we are not.”

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