InFocus | Commercial Properties
Affordable accommodation
Budget hotels are springing up across the UAE to attract business and leisure travellers of every class.
- By Latha Krishnan, Gulf News Report
- Published: 00:00 September 19, 2006
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Budget hotels are springing up across the UAE to attract business and leisure travellers of every class.
Despite high oil prices, security issues and other setbacks, the travel and tourism industry is growing all over the world. Online bookings, reasonably priced airline tickets and comfortable, yet affordable, hotels have all combined to tempt even the most careful middle-income traveller to venture out to exotic locales.
The UAE in general, and Dubai, in particular, are now among the most popular tourist destinations of the world. The Dubai Department of Tourism and Commerce Marketing envisages 15 million tourists annually by 2010. Other emirates also hope to attract tourists in a big way. So it is imperative that business and leisure travelers have enough accommodation when they arrive in the UAE.
With construction booming all over the UAE, especially in Dubai, new hospitality projects are also being announced regularly. Industry experts anticipate Dubai will increase its lodging supply by 18,200 to 20,000 rooms by 2010.
Five star and premium hotels continue to have good occupancy rates throughout the year in Dubai, thanks to a steady stream of high-income business and leisure travellers transiting through or visiting Dubai. But a recent trend is for big international hotel brands to open budget hotels or executive hotels for business travellers who want quality accommodation at reasonable rates.
Istithmar Hotels, a unit of Dubai's investment company Istithmar, has signed a deal with London-based easyGroup to develop a chain of easyHotels across the region. In a press report at its launch, an Isthithmar official says, "We have identified that the budget sector is a key opportunity. I think the Middle East market is largely dominated by unbranded, inconsistent and often poorly managed budget hotels and branded hotels such as easyHotels can provide a consistent and affordable product."
With its no-frills, economical prices and low overhead costs, the easyHotel brand is perfectly suited for budget travellers. Thirty-eight easyHotels are to spring up across the Gulf, North Africa and the Indian sub-continent. Six of these hotels will come up in Dubai as well as one each in Abu Dhabi and Sharjah. They are expected to be operational by the end of next year and will contribute significantly to the growth of the budget hotel sector in the country.
The $1.3 billion (about Dh5 billion) takeover of UK-based budget hotel chain Travelodge by Dubai International Capital (DIC), an offshoot of Dubai Holdings, is an indication of the demand for budget hotels around the world. Travelodge is considering a move to build its brand in this region, too, while strengthening its position in the UK and Europe.
Coral International Hotels, Resorts & Spas recently entered into a strategic agreement with Reef Real Estate Investment Company LLC for a joint venture called Corp Executive Hotels, which will develop a new generation of hotels offering a practical, safe, clean and affordable product. Shaikh Ahmed Mohammed Saqer Al Nahyan, Managing Director, Reef Real Estate Investment Company, said in press release, "We at Reef are planning to develop 2,000 rooms within the next couple of years. The Grand Opening of the first project under Corp Executive Hotels is located in Al Barsha area next to the Mall of the Emirates and will take place by the year-end."
Shaikh Mohammed Bin Faisal Al Qassimi, Chairman and CEO Manafa LLC and Vice-Chairman Coral International Hotels, Resorts and Spas, added that he found the idea of Corp Executive Hotels bold and exciting.
Value pricing, quality accommodation, professional service, hygiene, complete security and latest technological amenities will be the hallmark of Corp Executive Hotels and will tap into the booming market for affordable accommodation for business travellers. Corp Executive Hotels will initially have a portfolio of four hotels in the county and then move on to become a major global player.
The Al Bustan Hotel Group is planning to launch a series of Centro budget hotels in Dubai in the next couple of years. The Taj Group of Hotels, a Tata concern, is reaping the success of its budget venture called Ginger in India. The concept could be introduced in this region, too, in the not-so-distant future.
Currently, budget conscious travellers to the UAE can find rooms in three and two star hotels in good locations. Most of them do have clean, smart rooms but there are quite a few shortcomings in some of the hotels in terms of service and facilities. The advent of the branded value-priced hotels will definitely make the market competitive and inspire current players to upgrade amenities and spruce themselves up, which will result in more choice and better facilities for travellers.
