Dubai: The Abu Dhabi-based hotel group Rotana has exited from one project in Iran and has put the rest on hold following the US reimposition of sanctions last November, adopting a “wait and see” approach to the market.
Rotana was one of the first hotel companies to enter the market after sanctions were lifted on Iran in January 2016.
The US unilaterally reimposed sanctions on Iran in November last after a brief period of thaw in their relations, accusing the country of “outlaw” policies that were undermining regional stability.
Despite not having the backing of the other six countries that remain party to the 2015 Iranian nuclear agreement, the sanctions mean that companies in Europe and Asia are still largely unable to do business with Iran for fear of incurring steep penalties from the US.
“There is one hotel in particular that we have exited, there are others that are dormant, and it’s literally a wait and see,” said Guy Hutchinson, acting chief executive of Rotana.
Hutchinson didn’t specify which hotel in Iran the company had cut ties with.
Rotana later confirmed in a statement, however, that the Imam Reza Rotana in Mashhad, Iran, was still set to open in 2020.
A spokesperson for the company couldn’t be reached for comment when asked how the hotel would operate in Iran under the current regime of sanctions.
“There is not a lot of movement,” Hutchinson said about the company’s broader focus on Iran. “I think there was a point at which there was a push, and at that point we had a lot of active projects there.”
Following the new wave of sanctions placed on the state, he said, Iran was no longer a priority.
“We’re not pushing Iran, in any way, as a growth market.”
The company is extending its reach in to Africa with a new hotel in Dar es Salaam, Tanzania, which is set to open in August. Rotana will also open two new properties in Saudi Arabia this year, one in Al Khobar and the other in Dammam.