One of the important dimensions of surging economy of Dubai (UAE) is its powerful a hospitality sector. For the same reason, Dubai is touted as one of the most buoyant hospitality sector in the Middle East as well as across the globe, with an average occupancy of 80 percent and RevPAR of 815 (USD 220) in 2013, in spite of addition of 2780 rooms across the 3, 4 and 5 star categories. The strong sentiments continue with occupancy estimated at 88 percent in Q1, 2014. A remarkable number, given the fact that it is substantially larger than 62 percent; an estimation believed to be the benchmark of effective hotel performance.

Arabian Hotel Investment Conference (AHIC)

The Arabian Hotel Investment Conference (AHIC), which was held at the Madinat Jumeirah Dubai from 2nd – 5th of this month, symbolizes the general sentiments towards the hospitality industry in Dubai. The event in its 10th avatar  was visited by a range of dignitaries coming from leading local and international hospitality groups, government think tanks and hotel investor fraternity. The 3 day event was associated with networking roundtables, seminars, workshops and award presentations. Topics of discussion captured a range of subjects such as future strategies, sustainable and holistic growth, World Expo 2020, global perspectives and investment strategies etc. The conference has showcased the eagerness among the investors towards Dubai’s booming hospitality sector

Subdued Global Market: A blessing in Disguise

The higher investor confidence towards Dubai and the wider ME region can also be explained on the backdrop of a subdued global market. Western Europe is facing slowdown in growth due to intensifying of competition and oversupply of rooms. Linked to the ongoing recession, Southern European markets will take some time to recover. Similarly, Eastern and Central Europe is also under-performing. Prominent international markets such as Turkey and Russia have been affected by political crisis while emerging markets in Asia and Latin America have also witnessed dip in investor confidence.

In such an evolving global landscape, one of the markets which is becoming a natural favorite among global hospitality investors, is the Middle East region, which is driven by economic growth, younger demographics, rapidly expanding local airlines and aggressive marketing strategies. Unsurprisingly some of the most impressive occupation and RevPAR have been seen in the Middle East region. Destinations such as Dubai and Abu Dhabi on account of their cosmopolitan appeal, robust infrastructure and range of exciting attraction are demonstrating robust growth. Not to mention the economic resurgence that is fuelling the lucrative business tourism markets in the cities.

However, chances are less that Abu Dhabi will oversee any massive project in the short term, due to the existing oversupply in the market. In such situation most of the expected growth in UAE will be cornered around Dubai, which will accommodate around 130-150 new hotel and apartment projects in the next three years. This will take up the total number of rooms to 114,000 from the present 84,500.

Out of the estimated 30,000 new rooms, around one third is presently under construction. Some of the major hotels under construction in Dubai are JW Marriott Marquis (800 rooms), Marriott Al Jadaff (352 rooms) and Intercontinental Marina (132 rooms). In Q2, 2014, several other prominent projects are expected to be completed as well. This involves Hyatt Place in Deira and Pullman Hotel in Jumeirah. In addition many other exciting projects have been announced in the 1st quarter, work on which should follow soon.


As mentioned above AHIC has demonstrated an upswing in interest among investors towards Dubai’s hospitality industry. Taking a hint from this, it could be expected that more hotels, resorts and service apartments will be announced in the coming time to capitalize on the booming tourism and hospitality sector of Dubai. Restaurants, retail attractions and other tourism related ventures will also rise in big volume.

Research Konnection

The report has been compiled by Research Konnection Team, a Dubai based Market Research and Consulting House with a focus on capturing finer details of various sectors in UAE and translating them into winning propositions. Our emphasis is always on the right suggestion rather than good ones.

If you are someone who is looking out to enter into the Dubai market, feel free to Konnect. Based on our understanding of local dynamics coupled with our extensive research skills, we can help you develop a complete feasibility study and business plan. Our service won’t just be limited to that as we can consult and help you with various other dimensions of running a successful business in Dubai, ranging from company establishment assistance to Konnecting with the suitable and cost effective partners. Feel free to Konnect with us on

Author: RKonnect
The author is the Managing Director of Research Konnection, a Dubai based market research and consulting firm that helps local and international companies to identify emerging business opportunities and successfully expand in the Gulf region. The author can be reached at
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