In spite of room rate drop, investment in Dubai remains strong

Average room rates in four and five-star hotels in Dubai dropped by 5 percent in March, according to the latest data from HotStats as published by Hotelier Middle East.

The March MENA (Middle East and North Africa) Hotels Market Review reveals that rates fell to US$380, while occupancy remained stable at 89 percent. A decline in food and beverage contributed to an overall fall in revenues of 9 percent. 

But in spite of this downturn, investment in the Emirate remains strong. Meliá Hotels International has signed two new properties in the GCC, including the Meliá Downtown Residences Dubai, slated to open in 2018. Also in the pipeline is the 125-key Innside JLT Dubai, which is due to open in 2016, and ME by Melia, alongside Meliá Dubai.


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Nakheel has also announced plans to partner with Spain’s Riu Hotels & Resorts to build Dubai’s first all-inclusive beach resort at its planned Deira Islands scheme. Under the agreement, Nakheel and Riu Hotels & Resorts will create a 750-room, four-star all-inclusive hotel resort close to planned attractions at Deira Islands, including Deira Mall and Deira Islands Night Souk.

All-inclusive, Hotelier Middle East notes, is an as-yet untapped market for Dubai, but the government wants to broaden the emirate’s hotel offer beyond luxury and business and cater to families. Rixos Bab Al Bahr is the only hotel in the UAE that has declared itself as part of the all-inclusive tag.

The Riu resort at Deira Islands will also be one of the largest hotels in Dubai in terms of room numbers, the developer claimed.

Starwood expands in Dubai
And at the Arabian Hotel Investment Conference (AHIC) in Dubai, Starwood Hotels & Resorts Worldwide announced plans to double its portfolio in the Middle East, focusing on its luxury, upper upscale and mid-market brands with plans to open 50 hotels by 2019. The company has signed five new projects under its Aloft and Element brands in Dubai, Doha (Qatar) and Muscat (Oman), adding up to a total of seven signed deals to date. For the midscale division, the Dubai properties include the Aloft Dubai Airport, the Element Dubai Airport and the Aloft Dubai World Central. The first two properties properties signed with wasl hospitality and leisure, a subsidiary of wasl Asset Management Group. The Aloft Dubai World Central has signed on with Radar DWC and will be one of the first to open in Dubai World Central.

In terms of upper-upscale and luxury, three new Starwood hotels are set to open in Dubai with Al Habtoor City, one of the Middle East’s largest developments. The project will introduce the St. Regis and W Hotels brands to the Emirate along with a new Westin.

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