Dubai: With Saudi Arabia’s tourism industry opening up, hoteliers are lining up opportunities to cater to visitors and tourists.
Capitalising on the opportunity is UAE’s Rotana Hotels, which plans to open 20 hotels in the kingdom by 2030, as part of the Saudi Vision 2030 plan.
The Abu Dhabi-based hotel chain will have seven operating hotels there by the end of this year — four properties are already open with three more to come on board by the end of the year, according to the company’s chief executive.
“We are opening and signing new hotels there,” Omer Kaddouri, President and CEO, Rotana Hotel Management, told Gulf News in an interview on Sunday.
Back home in the UAE, meanwhile, which is Rotana’s strongest revenue generator, the company operates 34 hotels today, with 7-10 additional properties planned by 2020.
The UAE market accounts for 60 per cent of Rotana Hotels’ total revenues at present, with 40 per cent coming from other markets, Kaddouri said. “By 2020, it’s going to be 50-50.”
Overall expansion
Rotana’s target from five years ago, of opening 100 hotels by 2020, is still very much on track, according to Kaddouri.
By the end of this year, the hotelier plans to have 67 properties operational in the region including in the Middle East, Levant, Turkey and Africa, up from the current 60. “We opened up three this year and we have another seven to go,” he said.
Plans are afoot to open Rotana’s first hotel in Iran, by the end of this year or beginning of next.
The next market outside of the region for Rotana could be India, as it plans to open three hotels there in the near future.
“We have signed hotels in India but they are not open yet. We are hoping that we would be in India in the next two to three years,” Kaddouri said.
Challenges
While business has been great, it’s also been challenging, says Rotana’s chief.
“You can’t deny the fact that things have been challenging in the region for quite a long time.
“Last five years have been filled with challenges. It hasn’t been smooth sailing at all,” Kaddouri said.
According to him, the main challenge Rotana and every other hotel chain is facing is that there is a lot of pressure on the average room rate.
“However, this year we are starting to see a decrease in the lowering of rates.”
Kaddouri expects challenges to remain for at least two more years.
“While I think that we are going to be in a similar situation in 2018 and 2019, we are going to see a hike in average daily rates in 2020-2021, mainly because of Expo 2020. And then after that it’s probably going to go back to the pre-Expo days, which is very good.”
“I see things getting better as of 2020 in the UAE. Oil is starting to get better. The economy is although going through difficult times, in our industry, till 2020, we will struggle, and things are going to improve after that,” he added.
Hotels across the UAE are working tremendously hard to bring bed nights into the UAE, he said.
“The UAE hospitality industry is still in a phase of being like a teenager. We are still young and going through ups and downs. So, we are still going through the process of being a teenager to a young adult. Our industry needs to become mature,” Kaddouri said.
