Affordable hotels a key advantage for Dubai

One of the major strengths of Dubai's hospitality sector that has kept it afloat during the downturn as well as has put the emirate ahead of its neighbours in the hospitality market, has been its flexibility and diversity in offering visitors hotel rooms at different price points ranging from luxury to mid-scale and budget segments, according to a senior official of the global audit, tax, consulting, and financial advisory services firm Deloitte.

"60 per cent of the hotel rooms in Dubai are in the luxury segment, while the rest of the 40 per cent belong to the mid-scale and budget segment. That means out of 50,000 rooms that are operating in Dubai, 40 per cent or 20,000 are not in the luxury segment. This is a very positive trend in Dubai as it can offer travellers hotel products in the luxury, super luxury as well as in the budget-conscious end," Alex Kyriakidis, Global Managing Director, Tourism, Hospitality & Leisure, Deloitte, told Emirates 24|7.

In this way Dubai is ahead of its neighbours, he said, adding: "Abu Dhabi's hospitality sector, for example, is 90 per cent luxury while most of the other GCC countries have a very high percentage of the luxury segment."

He said the flexibility and diversity has enabled Dubai's hotels to attract travellers from across the world, especially from emerging markets, who may not necessarily afford to stay at a luxury hotel while they're on a visit to the emirate.

He emphasised the mid-scale and budget hotel segment is going to be the key driving factor for the GCC region's hospitality sector.
"The region should begin to focus more on non-luxury segment of the market. Today, as a result of the financial crisis, everybody has become more value-conscious and, unlike earlier, travellers now are now demanding maximum value for the dollars they are spending," Kyriakidis said.

Secondly, he said, the promotion of the hotel and tourism industry by the regional airlines is going to be crucial.

"The more the airline industry is in partnership with the hotel industry, the more opportunities are created for people to visit their destinations in the region. In Dubai, the reason why the hotel industry is running with 70 per cent occupancy is because Dubai is offering lots of good packages for people to visit Dubai," he said.

On Sunday, Deloitte also released its new report 'Hospitality 2015: Game Changers or Spectators' which said the Middle East is poised to benefit from the emerging 'new world order' in global travel and hospitality.

"A combination of 150 million new travellers from the emerging countries of China and India and the continued expansion of Middle East carriers present the Middle East with a unique opportunity to be a game changer in the global travel and tourism industry. Add to these ingredients the rich cultural and religious heritage of the Middle East, a young population and substantial investment in tourism infrastructure in the GCC led by Saudi Arabia, the UAE and Qatar and the stage is set for the region to emerge as preferred destination for travel & tourism globally," the report added.

China and India will continue to be the key hospitality markets, and according to the report, by 2015 these countries will have absolute year-on-year tourism growth greater than the United Kingdom, France or Japan. The growth of these outbound markets, coupled with the route networks of the Middle East carriers, will present the Middle East tourism industry with exceptional opportunities for growth.

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