Dubai: The CEO of hotel group IHG’s Middle East business has said that he is satisfied with the growth drivers in the Dubai hospitality market.

Kenneth Macpherson, IHG’s chief executive officer for Europe, Middle East, Asia and Africa, said that he believed the fundamentals were in place to counteract a market slowdown that has impacted room rates since for the past three years.

In Dubai Marina, where IHG already operates an Intercontinental and is currently building a new Crowne Plaza, Macpherson said he saw strong “corporate, retail, and residential drivers” that gave him confidence in the long-term strength of the area.

Despite this, IHG — which operates a number of other hotel brands including Holiday Inn and Hotel Indigo — is adjusting its strategy to adapt to market conditions.

Last week, the company opened its first Voco hotel in Dubai. The group converted the Nassima Royal Hotel on Shaikh Zayed Road, giving it a full facelift and rebranding.

The brand is targeting existing, primarily independent hotels and offering them a new identity and integration with a global hotel group, all for minimal capital investment.

Voco would appeal to “travellers who want the reliability that a brand brings, but the different assets a new brand brings,” Macpherson said.

The four Vocos that have opened globally since the brand’s launch last year had seen a “strong guest response,” he added.

The concept made sense in Dubai, the CEO said, because investors were looking for the maximum financial return possible.

“When markets get tougher, the opportunity to get the rate premium that a branded property is going to provide [is attractive],” Macpherson said.

“And a more profitable hotel that we can offer to our owners … is compelling economics.”

Another pillar of IHG’s strategy is to offer long-stay hotel apartments. On Tuesday, the company announced that it had signed an agreement with SRG Holding to develop two Staybridge Suites. properties, IHG’s extended-stay brand.

One of these will be located in the Dubai International Financial Centre (DIFC), and the other one in Dubai Internet City.

“Staybridge is purpose-designed for long-stay guests, the facilities are designed for those staying an extended period of time,” Macpherson said.

“We’re seeing that demand,” he added. “There’s obviously a lot of investment projects bringing in corporate business.”

IHG currently operates 23 hotels in the UAE, with another 15 in the pipeline.