Dubai hotels roll out the red carpet
A growing number of international visitors, coupled with preparations for Dubai to host Expo 2020, has meant that hotel inventory across the UAE will continue to record healthy growth in 2019, experts say.
"There are a lot of hotel openings scheduled in 2019 and we expect tourism to grow by five to six per cent during the year," said Olivier Harnisch, CEO of Emaar Hospitality Group. "Right now, everybody is preparing for Expo 2020. The big change that we will see in the industry will be a more noticeable shift towards new markets; the Chinese, Indian and Russian markets will continue to be important in the coming months. Dubai is the fourth most visited city in the world, and, moving forward, we can safely say that we have great ambitions for the hospitality sector."
Based on a report by Ventures ME, the UAE's hospitality market is expected to reach $7.6 billion by 2022, growing at a five-year compound annual growth rate (CAGR) of 8.5 per cent between 2017 and 2022.
Dubai's Department of Tourism and Commerce Marketing (Dubai Tourism) predicts that Dubai's hotel supply is expected to reach 132,000 by 2019. Similarly, STR Global found that the UAE witnessed an opening of approximately 8,000 branded hotel keys in 2018. Hotel supply will increase by 13.3 per cent in Dubai, with a CAGR of 10.2 per cent in occupied room nights, reaching 35.5 million annually in 2019.
Dubai's revised Tourism Strategy for 2022-2025 has set new goals of attracting 21-23 million visitors by 2022, and 23-25 million visitors by 2025. Helal Almarri, director-general of Dubai Tourism, said the progress through 2018 has been about maintaining stability and continuing to drive programmes for ongoing growth and consistent performance.
"We have everything that we need to hit the tourism targets for 2025," added Harnisch. "The great thing about Dubai is that there is good cooperation between the public and private sectors. The infrastructure is there and the appeal of the city is growing; we are in really good shape to be the most attractive city in the world."
"Expo 2020 is driving growth in Dubai, as the emirate aims to complete 160,000 hotel rooms in time to welcome an additional five million visitors during the event," said Frank Wolfe, CEO of Hospitality Financial and Technology Professionals (HFTP). "In preparation of the expected 25 million visitors, the city has made unprecedented investments in its infrastructure and hospitality sector to cater to the influx of travellers. The hotel industry is going through a period of unparalleled changes. As in other parts of the world, technology is playing a crucial role in the future of the hospitality industry while propelling Dubai's transition to a knowledge-based economy by 2021."
Recent data from Tophotelprojects' construction database showed a healthy pipeline of hotel projects in Dubai, with over 150 projects currently under way that will yield more than 48,000 rooms for guests. In addition, 46 per cent of the Dubai project pipeline will be designated first class hotel projects, while 54 per cent will be designated as luxury hotels. Around 30 per cent are scheduled for opening in 2019, with 50 per cent scheduled for the years after.
Mahmoud Kamal, CIO of Habtoor Hospitality, spoke about disruption in the hospitality industry. "Technology continues to transform the hospitality industry, revolutionising every aspect of the business. Having an integrated network of systems will enable hotels to build and foster the necessary connections for guests in order to cater to their requests and predict their needs. Currently, there is a great deal of work under way related to in-room automation to help bring the smart home concept of integrated and connected solutions into the hotel room."
Harnisch, however, cautioned against the unchecked use of technology in the industry. "You have to remember that not everyone wants the latest technology in their hotel rooms. Sometimes, it can be a bit overpowering, so a standard one-size-fits-all approach regarding technology in hotel rooms is not the way to go. The same goes for robots in the hotel industry; I think that they are going to be a very niche segment. Personalising experiences and the warmth of the human touch will continue to win out when it comes to leaving an impression on guests."
In addition to Dubai, several other emirates have also announced growing hotel inventories for the upcoming years. Ras Al Khaimah is preparing to add 5,000 rooms to the 6,500 currently available with the confirmed introduction of major global brands including Marriott, Movenpick, Sheraton, Anantara, Rezidor, Intercontinental and Conrad over the next three years.
"As our tourism offering evolves in Ras Al Khaimah, we must ensure our destination is attractive to travellers who wish to explore beyond the resorts and hotels. Our Tourism Strategy 2019-2021 is a comprehensive three-year programme that takes Ras Al Khaimah to the next level. We're delighted with the success our offering has had in our target markets to date, but with the new destination strategy, we aim to diversify and enhance visitors' experiences through differentiated product development," said Haitham Mattar, CEO of the Ras Al Khaimah Tourism Development Authority.
"Another area of focus for us will be positioning and promoting Ras Al Khaimah in targeted international markets to attract higher yield customers all year round," he added. "By 2021, we aim to employ 10,000 more people into the tourism and hospitality sector, and nurture investment from small and medium businesses which benefit the community. This will raise the overall competitiveness of the industry, attracting more international and local investments, therefore enabling an environment for sustainable growth."
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