Dubai has 19,200 new hotel rooms in the planning pipeline and hospitality investors are eyeing healthy returns, according to a report by Les Roches Global Hospitality Education alumnus.
The UAE is second after Saudi Arabia in terms of the number of projects in the Middle East and Dubai is the leading city with 19,200 rooms in the pipeline from 67 projects.
The Report, “A Clear Roadmap for a Hotel Business Investment in Dubai” highlights that occupancy levels are expected to sustain an upward trajectory, further solidifying Dubai’s position in the global hospitality market.
Dubai hotel pipeline
Occupancy rates have shown consistent growth, hitting a record 90.8 per cent in February 2024, underscoring the strong demand in the market.
Moreover, average daily rates (ADR) and revenue per available room (RevPAR) have risen significantly by 9.3 per cent and 13.1 per cent, respectively, reflecting strong profitability, according to reports from STR and Deloitte.
The city reports consistent month-on-month increases in RevPAR levels,
The report by Fares Yactine, Advisor EBD-FRD at Nesma United Industries, Ronald Homsy, Founder and Co-CEO at Aventra Hospitality, and Mohamad Saade, General Manager at Radisson Hotel Group said: “If we look at the pipeline for the next seven years, 46 per cent of the projected keys fall into the luxury category, 25 per cent go into the upmarket category, and roughly 4 per cent go into the three-star hotel category.
“The five-island development, formerly known as Deira Islands, is in line with the UAE’s continuous efforts to become a top worldwide destination for visitors and investors”.
Successful investments in Dubai’s hospitality market, such as the $1.4bn Atlantis The Royal and the expansion of Jumeirah Hotels, highlight the profitability potential in both luxury and mid-range segments.
This continued growth is backed by strong government initiatives like Dubai’s 2040 Urban Master Plan, aiming to boost the city’s appeal as a top-tier tourist and investment destination.
These factors together make Dubai an attractive market for both seasoned and new investors, offering robust returns with the right strategic approach.
According to a KPMG report, Dubai’s government has played a crucial role in fostering this growth, implementing favourable policies like tax incentives, relaxed visa regulations, and infrastructure initiatives under the city Tourism Vision 2025, which aims to attract 25m visitors annually, further solidifying the city’s position as a leading global tourist destination.
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