What’s Trending In The Hospitality Industry In UAE

Technology, Cuisine and Sustainability are the three areas when it comes to trends driving hospitality in the UAE.

Technology: According to the research made available by The Hotel Show (Dubai), the online travel agency bookings from the Middle East region will reach $3 billion (Dh 11 billion) in 2014 and they represent 17 per cent of the total sales but only 12 percent of the potential market. These numbers will grow year on year with the increase in the number of room nights in the region. Hotels are investing in technology to increase direct bookings and also to manage guest expectations.

According to Kai Schukowski, Hotel Manager at Hotel Kempinski Ajman, technology is very important in today’s market in order to stay competitive and being on par with the latest technological sis extremely important. While, Annamarie Lambri, Associate professor of Architecture and Interior design at American University believes that today’s guests demand to receive updates and information in real time, including the use of social media, use of mobile applications and platforms to facilitate connections.

Cuisine: They say that Food is the way to a consumer’s heart. Friday brunches are very popular and considered as a social tradition for expat in UAE. According to Kai Schukowski, Hotel Manager at Hotel Kempinski Ajman, there is a variety of F&B concepts available but the guests are still hungry to explore unique experiences and it could be one of the deciding factors for a guest stay. Schukowski ties this trend to mass affluent, as sixty per cent of the hotels are five stars in Dubai compared to 30 per cent in London. People visit restaurants in hotels frequently in the region on a regular basis.

Sustainability: Hotels in the region are turning towards more sustainable initiatives as it brings along tremendous savings. It is also based on the guests’ demands and the government’s policy to encourage more greener hotels. According to Amelie Zegmout, Hopitality Program Ambassador, Emirates Green Building council, local deployment of sustainable hotel specific certification bodies like Green Key and Green Globe is certainly helpful. Most of the hotels build their own green initiative policies and reporting. While Annamarie Lambri, Associate Professor of Architecture and Interior design at American University, said that sustainability is one of the key trends in the industry as all hotels in the region need to follow criteria and regulations to respect energy efficiency.

A study conducted by professors at Cornell University to understand if there is an advantage to operate environment friendly hotels over traditional hotel, reveals that while guests are not willing to pay more to stay at a hotel that practices the green initiative, hotels that receive certificates such as Leadership in Energy and Environment al Design (LEED) by the US Green Building Council, are cheaper to operate and highly profitable.

'The Hotel Show' - MENA region's Number One Hospitality Event Opens in Dubai

The 15^th edition of the Hotel Show, the premiere event for the trade and hospitality industry opens in Dubai on 28^th Sept 2014.

The three day event will attract over 600 participants suppliers of the latest products and leading global brands. The show brings together industry players from a range of services, including hospitality and leisure, design and restaurants, etc.

In 2013, 16,700 hotel and hospitality partners visited the show where deals worth almost $4 billion of business were sanctioned for the following 12 months.

The Hotel Show will feature conferences, awards, and unique networking opportunities for industry professionals.

“The Middle East is recognized as having some of the fastest growing economies in the world - with forecasts of up to 3 per cent growth before 2016 — and we are delighted to be able to offer real business opportunities to all who participate”, stated Christine Davidson, Event Director at The Hotel Show.”

The key highlight of the show is the Vision conference, where Issam Kazim, The Chief Executive of Dubai Corporation for Tourism and Marketing (DCTCM) will deliver a key note speech. Other sessions of the conference will cover trends in the hospitality and leisure sector, the development and growth of mid market hotels, and interior designing trends.

Another feature of the show is International Village, where more than 300 international companies will be represented from more than 45 countries, including Austria, Belgium, China, Egypt, France, Germany, Greece, India, Italy, Philippines, Portugal, Spain, Turkey, Thailand, Vietnam and the UK.

GCC Hospitality Industry Set To Reach $35.9 Billion By 2018

The hospitality industry in GCC is forecast to grow from $22.8 billion (Dh83.7 billion) in 2013 to $35.9 billion by 2018 at an annual rater of 9.5 % according to a new report by investment bank, Alpen Capital.

The UAE’s Hospitality industry is expected to grow at a compound annual growth rate of 10 per cent between 2013 and 2018.

Average Hotel occupancy rates in GCC are expected to be between 68 percent and 74 per cent between 2013 and 2018, while the average daily rate (ADR) is likely to be between $225 and $263 during the same period.

The growth of the industry in the region will be fuelled by the shift in global activity from East to West, a rise in leisure travel, higher demand for serviced apartments, a shift towards budget travel and quicker construction pipeline, said Sanjay Bhatia, Managing director of Alpen Capital.

The sector’s growth is also expected to be driven by increase in international tourist arrivals, and a stronger MICE segment among others, said Sameena Ahmad, managing director of Alpen Capital in the Middle East.

According to the report, Saudi Arabia is expected to continue its dominance as the largest market in terms of revenue, followed by the UAE.    

The GCC has made major investments in the airport infrastructure, with Al Maktoum International at Dubai World is undergoing a Dh 117.5 billion which is expected to begin by end of the year. The airport will be able to serve 120 million passengers within six to eight year.

Airports across the region are expected to handle as many as 250 million passengers by 2020, according to Reed Exhibitions, quoting a study.

However, as the GCC countries are set to boost their hotel room capacity in the run up to major events, they also face the challenge of sustaining the demands after the events take place. The region has made major investments in infrastructure for events like World Expo 2020 in Dubai. The six month long Exhibition will be the main driver of the hospitality industry in UAE, which is valued at 23 billion dollars according to the report. However, in Dubai the hotel room supply and demand could be balanced after Expo 2020.

Other challenge faced by the GCC region is competing with newer projects and attracting skilled labor force.

Sanjay Bhatia, also said that, the growth of the sector will be driven by supportive policy initiatives undertaken by GCC governments to enhance infrastructure; there by positively impacting the continued investor appetite for the region and tourism.

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Dubai Hotel Occupancy Up 2.1% in August 2014

Hotels in Dubai saw occupancy grow by 2.1 per cent cent to 75.1 per cent in August compared the same period in 2013, according to the data released by the firm STR Global.

Occupancy performance is back to normal trading conditions after holy month of Ramadan in July.

The Dubai Hotel Occupancy dropped by 12 per cent to 45% in July due to slow demand in summer and increase in supply of hotel rooms in the city.

Supply rose by 8.6 per cent as of August, while demand grew by 10.9 per cent. There are currently 628 Hotels under contract with 147,454 rooms, in Middle East and Africa, according to the August 2014 STR Global Construction Pipeline Report. In GCC, Saudi Arabia posted the largest increase in existing supply, (115.7 per cent), i.e. if all the 7,396 rooms under contract open.

Meanwhile, average daily rate (ADR) in August fell 5.7 per cent to Dh682.21 and as a result, revenue per available room (RevPAR – a performance benchmark) declined 3.7 per cent to Dh512.5. In July, ADR was 5 per cent up to Dh638.7, while RevPAR dropped 7.4 per cent to Dh290.23.

Elizabeth Winkle, managing director of STR Global said that “The overall decline in ADR, however, is strongly related to the three days of Eid celebrations shifting months, where Dubai hotels experience a spike in hotel performance.”

Damac, Paramount Launch 1250-key Luxury Hotel in Dubai

Damac Properties continues to grow its partnership with its luxury partner Paramount Hotels & Resorts with 1250-key property confirmed for Downtown Dubai.

Paramount Hotel will be the fourth project by the partners in Dubai off Sheikh Zayed Road. The property is set to open in 2018.

Paramount Hotels & Resorts was established and registered in 2012 and has a long term, exclusive agreement with Paramount Licensing Inc., the licensing division of film studio Paramount Pictures Corporation, to establish a chain of Paramount branded hotels and resorts.

The new Hotel will integrate elements of Paramount Pictures movies through high tech media mapping and digital signage. The hotel will aim to showcase timeless elegance meets Californian lifestyle and Contemporary styling. The property will identify its own identity influenced by the local creative communities.

"The number of visitors to Dubai is set to double in the next six years and the Paramount Hotel Dubai, Downtown will support the growth with a high-end, theatrical and immersive experience for international tourists," said Ziad El Chaar, Managing Director, DAMAC Properties. "Our current projects under development with Paramount Hotels & Resorts have proved immensely popular and there is clearly a high demand for unique and luxurious hotel accommodation in Dubai."

The sales launch is planned for early next year, and the property will present an opportunity for investors to invest in Dubai’s booming market which is set to exceed by 20 million tourists in 2020. The hotel rooms will be available for investment during the build phase of the project allowing the investors to capitalize on revenue when the project opens.

Damac and Paramount are collaborating on a beach front hotel, Paramount Hotel, Jumeirah Waterfront, as well as Damac Villas by Paramount in Akoya development. While in Saudi Arabia, they are working on a serviced hotel apartment project, Damac Towers on King Fahd Road in Saudi Arabia.

Dubai’s Palm Jumeirah To Get New $1.5 billion Royal Atlantis Resort

Dubai's ruler Sheikh Mohammed bin Rashid Al Maktoum has approved the construction of a new Resort on the Palm Jumeirah Island by the Investment Corporation of Dubai (ICD).

ICD unveiled a plan for a US $1.4 billion Royal Atlantis Resort and Residences with a design that is set to dominate the Palm skyline.

Located on the crescent of the Palm Jumeirah and next to Atlantis Resort, the Royal Atlantis Resort will stand 46 stories tall, consisting of 800 rooms, suites, 250 luxury hotel apartments, retail area, infinity pool and private gardens. The hotel which is scheduled to open by 2018 will be developed in association with Kerzner International and will also house recreational and entertainment facilities.

Sheikh Mohammed said that the resort will develop and diversify UAE’s economy.

The announcement of the second Atlantis Hotel comes after US Hotel Operator Marriott announces that it will take over the management of the Atlantis hotel in Bahamas from the end of 2014.

ICD bought a 46% stake in Kerzner International in April this year, while Istithmar World, a subsidiary of DP World owns another 25% stake. ICD is also developing another Atlantis hotel in Sanya, China, that will be the third largest resort in the World on 60 hectares.

Dubai’s largest Atlantis resort had the highest inventory of 1569 rooms when it opened in 2008 but it was replaced by JW Marriott Marquis this year with a room count of 1608.

Jumeirah Group Third Most Influential Brand In The UAE

Jumeirah Group, Etihad Airways, Emirates Airline, Emaar and Damac are ranked among the top 10 most influential brands in the UAE according to the rankings released by professional networking platform LinkedIn.

The rankings are based on engagement among LinkedIn’s total 313 million user base and are calculated by evaluating the communication and activities of the brands on LinkedIn.

UAE’s airlines and Hospitality brands have dominated the top 10 list. Jumeirah was ranked third just behind Etihad Airways and Emirate Airlines, in the first and second place respectively.

Emaar, another major hospitality and leisure brand in the Middle East, was ranked fifth, while Damac came in ninth.

Jacob Thomas, Marketing Solutions Lead at LinkedIn said “While LinkedIn offers brands unmatched opportunities to reach out and engage with their target audiences, any marketing effort needs constant and consistent measurement to ensure success”

“The brands we have identified in the UAE are leading among their peers in using LinkedIn's Marketing Solutions most effectively, and the make-up of the ranking shows that social media is a significant focus for brands in the UAE."

The rankings were released post the announcement of earlier this year of LinkedIn’s Content Marketing Score, a data driven resource giving brands insight into the engagement with paid and organic content on the platform.

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