Russian plane crash affected demand for accommodation in Hurghada, Sharm El-Sheikh

A report issued by Colliers International Consulting Centre revealed that the Russian plane crash on 31 October affected the demand for hotels in Sharm El-Sheikh and Hurghada; however, demand has remained strong in the hotel sector in Cairo because of tourism from the gulf.

The Russian plane carrying 224 passengers was on its way back to the city of St. Petersburg from Sharm el-Sheikh when it crashed in Sinai on 31 October.

The report predicted the crisis would continue for the hotel sector in the coastal areas of the Red Sea until the end of 2015.

According to the report, the entry of four hotels to the market is responsible for supply growth in hotel capacity during that period. “During that period, four hotels entered into service, namely Marriott International, Starwood, Kempinski, and Louvre Group,” according to Colliers.

The international commercial supply represents 64% of the hotel market in Cairo, of which 86% are classified as five stars. Hotels will witness growth in the accommodation rates and the average wage over the third quarter of 2015 because of an increase in companies’ demand.