So far, 2024 has been a difficult year for Lebanon’s hospitality sector. Since October 2023, political strife in the region has greatly affected tourism. We take a closer look at the market, the challenges facing hotels and what summer 2024 is likely to have in store.
In an unstable market such as Lebanon’s, hotels must be ready to react to all kinds of crises.
According to Sherine Salha, shareholder of Phoenicia Hotel Beirut, challenges have intensified due to the lack of credit facilities to renovate, expand and innovate. She said: “It is hard to stay ahead of the game, especially having to deal with cash-flow management issues. Ultimately, there’s only so much hotels can withstand.”
Challenges and hopes
Indeed, as Lebanon has long been impacted by political and security concerns in the region, and even in the world, the hospitality sector is accustomed to knocks and setbacks. Eddy Nohra, GM of Staybridge Suites an IHG hotel, pointed out: “Luckily 2023 was a very good year, at least until October, which gives us hope for summer 2024 and a quick recovery.”
Shadi Gedeon, GM of Movenpick Hotel and Resort, revealed that summer 2023, specifically the month of July, was outstanding in terms of revenue. He is hopeful that the summer will be a busy one.
However, there are concerns on multiple fronts. Utilities continue to be a huge expense for operators, and an increase in government taxes is likely to take a heavy toll on the industry.
Samer AbouAleiwi, GM of Beirut’s Gefinor Rotana Hotel, added that is proving difficult to maintain talented team, especially with many skilled employees seeking opportunities overseas, especially in the Gulf.
Furthermore, the number and frequency of flights to Lebanon has dropped, so the assertion that planes are full doesn’t actually mean a high number of tourists.
The Beirut Port blast had a catastrophic impact on the city, with many hotels forced into closure. In addition, the economic crisis has prevented several from reopening.
Tourist profile
Traditionally, Lebanon was a magnet for wealthy Arabs, and while it still attracts Qataris and Kuwaitis, a growing number of Iraqis, Syrians and Egyptians are coming to the country. The percentage of Jordanian tourists has decreased, primarily due to the war in Gaza.
In terms of tourists from further afar, Lebanon attracts Europeans, especially from France, and visitors from Latin America. This is largely thanks to the Lebanese diaspora in Brazil and their desire to visit their homeland.
F&B services in hotels
Managing hotel restaurants requires meeting guest expectations while maintaining independence from a hotel’s overall operations, according to Salha.
It is true that room service remains an important source of revenue for a hotel. Gedeon believes that stand-alone restaurants in Beirut are hard for hotel venues to compete with because they have an entirely different approach to F&B.
The role of F&B in hospitality
The hotel industry debates the profitability of food and beverage outlets compared to room revenue, with some advocating for partnerships with established F&B brands. Challenges include accurately determining costs and maximizing returns from F&B operations.
It is important to acknowledge that F&B services in hotels play a crucial role in creating memorable experiences and enhancing brand image. Strategic investments in curated dining experiences have the potential to boost revenue and guest satisfaction in luxury hospitality.
