The enthusiasm for building new hotels in Dubai precedes by at least a year the announcement in late November 2013 that the emirate had won the right to stage World Expo 2020. An increase in foreign visitors had already created demand for more rooms in both hotels and hotel apartments. Christopher Hewett, senior consultant at TRI Hospitality Consulting in Dubai, told OBG, “In terms of future supply, there are some estimates of more than 10,000 hotel rooms entering the market over the next four years. However, based on our projections we believe at least 50,000 new rooms will be available before Expo 2020, increasing the overall supply to more than 120,000 rooms.”
Elizabeth Winkle, the managing director of STR Global, forecast at the beginning of 2013 that Dubai’s then 56,423 available hotel rooms would increase by 7.1% on a compound annual growth rate basis over the next three years. With so many international hoteliers active in the emirate, the activity and the numbers are always changing. This is a snapshot of what some of the major players are planning or have recently completed.
The world’s tallest hotel, JW Marriott Hotel Marquis Dubai, is set to open its second tower in 2014. Rupprecht Queitsch, the hotel’s general manager, told the local press it would be opened in phases with either a third or half opening up in the first quarter of 2014. Each tower has 804 rooms.
According to Neal Jones, the company’s chief sales and marketing officer for the Middle East and Africa, Marriott International’s plans to increase its number of hotel rooms in Dubai to 10,000 by 2020 have been underpinned by the successful Expo 2020 bid. Marriott has 2700 rooms in Dubai and by 2020 the emirate will account for around 14% of all the group’s regional hotel rooms from a total expected by then to be 70,000. Jones said that his company was eyeing Dubai World Central (DWC), the planned site for Expo 2020 and home to Al Maktoum International Airport. He added that given the right investment, Marriott International could be one of the first hotels to move into DWC.
In fact Emaar Properties has signed a deal with DWC to develop a residential project near the area where Expo 2020 will take place. The phased development on 13.6m sq metres will see first a villa community set around a golf course, several hotels and a mall, according to Emaar.
The Marriott may not also enjoy its status as the world’s tallest hotel for much longer. The 101-floor Dream Dubai Marina is set to take over that title. Its 420 metres put it around 65 metres higher than the Marriott. At $400m to build that makes it almost a million dollars a metre. The Dream Dubai will have 300 hotel rooms as well as 420 branded and serviced apartments. Its developer, Sheffield Holding, says the hotel will open in the last quarter of 2014 with the serviced apartments following in five years. In recent years, privately owned serviced apartments have been popular with investors and, according to a recent report by Standard Chartered Bank, rental income for apartments in Dubai rose by 20% over the past year compared with a 17% gain for villas. Apartment prices in Dream Dubai will range from Dh2m ($544,400) for a one-bedroom flat to Dh25m ($6.8m) for the penthouses. MÖVENPICK:A 168-room Mövenpick Hotel will be the first five-star hotel in the Jumeirah Lakes Towers (JLT) and the sixth hotel in Dubai to be managed by the Swiss hospitality company. “Many major global corporations are relocating to JLT and this is creating a diverse, exciting neighbourhood,” Andreas Mattmüller, the chief operations officer of Mövenpick Hotels & Resorts Middle East and Asia, told the local press. With its man-made lakes and 64 contemporary towers, the JLT has become one of Dubai’s fastest-growing districts with more than 50,000 people working and living in the area and 6500 companies using it as a business base.
The InterContinental Hotels Group (IHG) has 18 hotels in the emirates with more than 5000 rooms, and seven more properties in the pipeline. IHG regional properties slated to open in 2014 include projects in Kuwait, Oman and Saudi Arabia, as well as the InterContinental Dubai Marina. There are also two additional InterContinental properties, three Staybridge Suites properties and a Crowne Plaza Resort in Ras Al Khaimah in the pipeline.
DAMAC Properties is to develop 7957 serviced hotel apartments spread over 8.2m sq feet by 2016. “Even with more hotels coming on-line in the next few years, Dubai’s exponential growth as an attractive global tourist and business destination will see demand exceed supply by 2016,” Ziad El Chaar, the managing director of DAMAC Properties, told the local press. DAMAC also awarded the Dubai branch of Turkey's TAV Construction a $272.3m contract to build a luxury hotel complex near the world’s tallest building, Burj Khalifa. Each of the four 250-metre-high towers, which make up DAMAC Towers by Paramount, has 540 hotel rooms and some 1400 serviced apartments.
Nakheel has set up a new division, Nakheel Hospitality and Leisure, to look after the firm’s hotels, beach clubs and community recreation centres. It will be headed by Thorsten Ries as managing director. Among his portfolio will be the 240-room hotel the company is building at Dragon Mart, a five-star, 40-storey hotel on Palm Jumeirah, and an economy hotel at Ibn Battuta Mall. The developer owns and operates recreation and leisure clubs, including Jumeirah Islands Club and Jebel Ali Club, among others.
CSCEC: The China State Construction Engineering Corporation (CSCEC) is making its first investment in a Middle East development project by joining forces with Skai Holdings to build a Viceroy Dubai hotel on Palm Jumeirah. The companies will form a special purpose vehicle, ASSAS, to deliver the $1bn scheme, which is due to open in the fourth quarter of 2014. Yu Tao, president and CEO of the CSCEC’s Middle East operations, said, “This is CSCEC’s first investment in a development project in the Middle East and marks a significant milestone in our growth in the region.” The CSCEC is one of China’s biggest building contractors, with a turnover in 2012 of $93bn. Skai Holdings worked with CSCEC to launch the Palm Viceroy and furnished residences project in mid-2013. The hotel will offer 481 guest rooms and suites and 221 residences when it opens in 2016. Investors are allowed to buy rooms and lease them back to the hotel in return for 40% of room revenue.
The first Conrad hotel in the Gulf has installed a car lift that goes straight into its ballrooms. The elevator is capable of carrying up to four tonnes and can be used to allow brides and grooms to drive up the aisle. The 555-room, 54-storey Conrad, which towers over the Dubai World Trade Centre metro station, is Hilton’s fourth hotel in Dubai and its 13th in the UAE. Another Hilton brand, the Waldorf Astoria will open at Dubai Palm Jumeirah in 2014 and three DoubleTree hotels are on the cards for the next two years, two in Dubai and one at Marjan Island in Ras al Khaimah.
French hotel chain Sofitel has earmarked two hotels in Dubai and another in Abu Dhabi in the next three years. These follow the opening of a 543-room Sofitel Palm Resort and Spa on Palm Jumeirah in July 2013. Robert Gaymer-Jones, the CEO of Sofitel Worldwide, said, “Dubai has changed significantly; whereas earlier summer was considered low season now almost every hotel is reporting 85% occupancy rates in summer.” The 350-room Sofitel Dubai Downtown due to open in March 2014 is expected to employ around 400 people. Sofitel Palm Resort already has 650 permanent employees, a figure that may rise to around 800. Sofitel is considering introducing into Dubai its luxury brand Sofitel SO. At present there are two Sofitel SO hotels, in Mauritius and Bangkok, with a third set to open in Singapore on May 1, 2014.
Another hotel project that is back on the table, although not confirmed, is Deep Ocean Technology’s proposed Water Discus Underwater Hotel. First suggested in 2012, the hotel would be a series of interconnected platforms, with a large one containing a sunbathing deck above the surface of the water and 21 luxury rooms underwater, each with views of marine life. The design is said to be capable of withstanding a strong tsunami and the underwater sections double as survival rafts in cases of an emergency. However, any risks are slight as the hotel would be constructed in relatively shallow coastal waters of around 10 metres.
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