With Dubai in full-bore expansion mode, hotel groups follow

During the global economic downturn, oil-poor Dubai became a cautionary tale for what happens when the lifeline of your economy—travel and tourism—dries up. However, the tables have now turned—in a good way, for Dubai. People are once again traveling, businesses are releasing the yoke on corporate travel and, overall, consumer confidence is on the rise.

What a great confluence of events for Dubai—not to mention hotel companies who are looking to seize on the opportunity. Dubai's hotels saw more than 5.8 million tourists in the first half of 2014—reportedly the highest number of visitors ever achieved in the first six months of a year, according to Dubai's Department of Tourism and Commerce Marketing.

Starwood Hotels & Resorts Worldwide has taken note. The Stamford, Conn.-based hotel operator is especially looking to grow its midscale brands in Dubai—Aloft, Element and Four Points by Sheraton.

"The next wave of growth in Dubai will be with some of our three and four-star brands such as Aloft, Element and Four Points by Sheraton, and the goal is to have Dubai as second to none in terms of number of hotels for Starwood," said Starwood CEO Frits van Paasschen.

But it's not just midscale—upscale to luxury, too. Starwood expects to open a 474-room Sheraton Grand Hotel on Sheikh Zayed Road later this month. Next year, it reportedly plans to open the the St Regis at Al Habtoor’s complex, which will also include a Westin and W.

Starwood & Emirates Partnership
Much of this growth is also being fueled by Emirates Airline, which is expanding its daily flights between Dubai and the U.S. The airline will add its fourth daily flight from Dubai International Airport to New York's JFK next March.

Here there is synergy between the two companies. Yesterday, at a press conference in New York, Starwood and Emirates announced a new partnership providing reciprocal benefits to SPG and Emirates Skywards members. The program, Your World Rewards, which begins November 19, allows SPG and Skywards elite members who register for the program, to elevate their earnings and benefits when they fly with Emirates or stay with SPG participating hotels.  

"We are living in a new Golden Age of Travel with more people from more places traveling than ever before," said Mark Vondrasek, SVP, distribution, loyalty and partnership marketing at Starwood. "Your World Rewards allows us to cultivate even greater loyalty with travelers from the world’s fastest-growing travel markets. As Emirates increasingly connects East with West, and the emerging markets to the developed world, their reach dovetails perfectly with Starwood’s preeminent high-end, global footprint and our pipeline of new hotels, 75 percent of which will open in emerging markets."

He added that the partnership between Starwood and Emirates "is the next frontier" in loyalty programs.

According to Vondrasek, the Middle East is SPG’s third fastest-growing market behind China and India. Starwood expects to grow its footprint by 70 percent over the next five years, specifically in Dubai and other Gulf states such as Saudi Arabia.

Other hotel news in Dubai includes a planned Hard Rock hotel project scheduled to open in mid-2015, and a Park Inn by Radisson with a scheduled 2017 opening date.

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