Two leading players in Dubai’s burgeoning short-term residential rental market have joined forces in an Dh18-billion deal to furnish and manage some 10,000 holiday homes.
The partnership between Gallery Suites Vacation Rentals and OYO Rooms will primarily focus on the upscale market, where the properties will be distinguished by “exquisite artifacts and art installations”, according to a statement released on Thursday announcing the deal.
Instead of competing for the same marketshare, the venture is an opportunity to leverage the strengths of both companies, said Pranav Mehta, country head for UAE and Oman at OYO Arabia.
“The unique approach that The IBC Group and Gallery Suites are taking in selecting prime hot locations, and in furnishing this portfolio of properties, as well as the scale of the venture, represents an exciting possibility for collaboration between our two companies,” Pranav said.
Gallery Suites is a subsidiary of the UAE-based IBC Group, which recently announced a massive expansion plan in Dubai’s holiday home market. OYO Rooms is the third-largest hospitality brand in the world.
According to Gallery Suites’ Khurram Shroff, the deal comes at a time when short-term rental has seen exponential growth in Dubai. “Dubai’s holiday home market accounts for 2 per cent of Dubai’s total households, which is the highest proportion of all other key global hub cities,” said Shroff in a Knight Frank report. “Active short-term rentals currently listed in the city number 10,766, which represents growth exceeding 160 per cent, since 2016. ”
IBC Group will retain ownership of the properties, leasing them to Gallery Suites to furnish and operate. OYO Rooms will take care of operational functions such as marketing, housekeeping and check-in/check-out facilities.
The properties will be mainly in locations such as Dubai Marina and Palm Jumeirah, which are rated high in the “occupancy heat map” on the recent Dubai Holiday Homes Market Review 2019 by Knight Frank.