Interview: Sheikh Faisal bin Qassim Al Thani
Given the number of properties under construction in Qatar, to what extent are developers looking outside the domestic market for opportunities?
SHEIKH FAISAL BIN QASSIM AL THANI: The Qatari market offers a number of opportunities for development in hospitality and tourism. That said, companies with the ability to invest outside Qatar have been developing in the Gulf region for some time and, more recently, in markets further afield, particularly the US, Europe and North Africa. Al Faisal Holding already has a strong domestic footing, so we would like the opportunity to prove ourselves internationally. This would allow other companies in Qatar, particularly small to medium-sized companies, to expand within the domestic market.
How concerned are hospitality developers about the amount of hotel developments being built?
SHEIKH FAISAL: We are not concerned. Qatar’s status as a prime destination is reflected in the high level of interest people have in coming to Qatar, especially for business, regional tourism and meetings, incentives, conferencing and events. The number of visitors and size of investments coming into the market will help sustain these areas moving forward.
Simply put, Qatar needs more hotels and more rooms. The government has put a lot of effort into promoting Qatar and attracting visitors to the country. It is the role of the private sector to support that vision and build the hotels that will meet projected future demand. Al Faisal is currently building a number of hotels to meet that need, with a number of properties now under construction and an agreement with a leading hospitality company has been signed to bring new hotel brands to Doha. All of these properties will be finished soon.
Given the saturation of five-star properties in Bahrain, what more can be done to expand offerings in the three- and four-star segments?
SHEIKH FAISAL: The Qatar Tourism Authority has recently been encouraging investments in those two segments. Typically, three-star hospitality development is carried out by smaller developers, while four- and five-star developments are carried out by top international operators. The four-star category has become an increasingly lucrative investment opportunity in Qatar, with a number of developers starting to build hotels in this segment. Of the hotels we are currently building, three of them are four-star properties, including one in Al Saad and one in West Bay.
The vision for hospitality developers should not stop at the 2022 FIFA World Cup. That is a short-term event, and we must consider the future demand of the country, which will be primarily in the four- and five-star segments. We look for long-term strategic developments that will support the country’s growth in line with Qatar National Vision 2030 and beyond.
To what extent are the retail and hospitality sectors developing in unison? With so much retail space going up, are there worries about over-saturation?
SHEIKH FAISAL: In the past, Qataris shopped almost exclusively abroad. Now, everything is available locally and this has had a huge impact on the amount of retail spending. The purchasing power of Qataris, foreign residents and visitors has driven this construction boom in retail. Qatar still needs more malls and, in particular, specialised ones that target specific segments.
As mentioned, we do not expect a big impact on our retail operations given the strong purchasing power in the country. As the number of retail outlets grows, each mall will have its own client base that it will cater to, whereas now a handful of malls cater to the entire population. New developments will generate greater competition, and this will improve both the quality and range of the products and facilities on offer. A wider variety of mall offerings could, however, have an impact on souqs (open-air markets), street stores and smaller shops by reducing footfall. This might benefit the larger retail developments in the long term as local businesses relocate to malls to counter falling revenues.
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