Next year is poised to be a good one for the UAE-based Al Habtoor Group, which is looking to invest AED 2 billion in international acquisitions in 2016, most of which will be in hospitality. The value of the group's overall investments in Dubai alone are worth AED 12.5 billion.
“I am always considering international growth, and looking for sound investments abroad. My focus is on Europe and the United States,” Chairman Khalaf Ahmad Al Habtoor said in a statement.
International partnerships, international growth
Al Habtoor Group’s hotels division saw revenue expand 23 percent in the first nine months of 2015, adding several international brands to its portfolio over the course of the year and repositioning its Dubai assets through international agreements. Local assets include The Waldorf Astoria Dubai Palm Jumeirah; The Habtoor Grand Beach Resort & Spa, Autograph Collection, a franchise of Marriott International; and the recently opened St. Regis Dubai at Al Habtoor City. Two other five-star hotels will open early next year in the upmarket development: The W Dubai – Al Habtoor City and The Westin Dubai, Al Habtoor City.
Globally, the group has partnered with The Ritz-Carlton to open the Elizabeth Park Hotel in Budapest. It also owns the InterContinental Budapest Hotel as well as two hotels in Lebanon: The Hilton Beirut Habtoor Grand and The Hilton Beirut Metropolitan Palace. Last year, the group entered the U.S. hospitality market for the first time when it bought The President Abraham Lincoln Springfield (Ill.), a DoubleTree by Hilton Hotel.
Al Habtoor said that occupancy rates at the the company’s Dubai hotels saw above-average capacity for much of the year, and revenue at all the international properties increased by double digits in the first nine months of 2015. Overall revenues rose 16 percent year-on-year during the first nine months of 2015.
Next year, all three of the hotels within Al Habtoor City will be fully operational. “The Residence Collection at Al Habtoor City is ahead of schedule,” the chairman said. “By the end of 2015, construction will be 50-percent complete.”
The group is also developing The Al Habtoor Polo Resort & Club in DubaiLand, which will include a St. Regis Hotel (and the brand's first polo resort.) When the resort opens at the end of 2016, it will include 156 luxury villas, 24 of which will be St. Regis-branded. Other developments under construction include a new Metropolitan Hotel on Sheikh Zayed Road.
Beyond Dubai, Arabian Business notes that the group may look to Egypt if President Abdel Dattah Al-Sisi will implement "investor-friendly" incentives. The president and the chairman reportedly met recently in Cairo to discuss investment, but Al Habtoor reportedly said that Egypt needs to attract "more confidence" to attract big investors. "I commend President Al-Sisi on implementing procedures to issue trade licenses for foreign investors in less than three days," he said in a statement, before noting that as an investor, he wants to see additional investor-friendly initiatives like tax incentives and guaranteeing that repatriation of funds is given priority by the Central Bank of Egypt.
"I would like to emphasize that individuals and businesses in the GCC are eager to invest in Egypt, including myself," he added. "There is huge untapped potential as well as access to a vast consumer market - as long as there is stability."
Al Habtoor said infrastructure investment is key to Egypt's success. "I would encourage investment in infrastructural projects. This would help bring the country's infrastructure up to date and create much-needed jobs. This is a key driver for economic growth. It will significantly increase productivity and lower production costs. It is a win-win situation."
In February, Al Habtoor claimed that he wanted to recreate Dubai's Al Habtoor City in Egypt. No word yet on what hotels would be included in this potential development.