Dubai launches hotel investment incentive to boost tourism growth

Dubai: The Dubai Department of Economy and Tourism (DET) has introduced a new incentive programme for hotel investors, aimed at accelerating the development of hospitality projects in high-growth areas and supporting the city’s expanding tourism industry.

The initiative follows Executive Council Resolution No. (68) of 2025, approved by Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai, Deputy Prime Minister, Minister of Defence, and Chairman of The Executive Council of Dubai.

Under the new programme, eligible hotels, resorts, and hotel apartments located in Dubai South, Palm Jebel Ali, Dubai Parks, and Dubai Islands will receive a 100% reimbursement of the Dubai Municipality fee on room sales and the Tourism Dirham fee for a two-year period after opening.

The incentive is available for newly registered hotels that meet DET’s licensing and classification requirements and commence operations within three years of application. The department will oversee applications, verify eligibility, and monitor compliance throughout the benefit period.

Issam Kazim, CEO of the Dubai Corporation for Tourism and Commerce Marketing, said the incentive marks “an important new phase in the development of Dubai’s hospitality ecosystem.”

“The launch of this hotel incentive programme expands our hospitality footprint in emerging areas of the city and ensures we can maintain our strong tourism growth trajectory,” Issam Kazim said.

“Our commitment to public-private partnerships and a diversified market approach continues to be at the heart of our tourism strategy. This new programme reinforces our goal of making Dubai the best city to visit, live, work, and invest in.”

Khalifa Al Zaffin, Executive Chairman of Dubai Aviation City Corporation and Dubai South, said the measure will encourage more investment in developing districts such as Dubai South.

“This decision reflects the forward-looking vision of our leadership to strengthen the competitiveness of the business environment and foster an investment climate that attracts private-sector participation,” Khalifa Al Zaffin said.

Khalid Al Malik, Managing Director of Dubai Holding, said the new programme demonstrates Dubai’s proactive approach to attracting investment and promoting sustainable growth.

“Dubai’s rise as a leading global hub is the result of visionary leadership and bold initiatives such as this investor incentive programme,” Khalid Al Malik said. “Dubai Holding is proud to contribute by developing destinations that attract global investment and support economic diversification.”

The initiative comes as Dubai continues to post record tourism performance.

Between January and August 2025, the city welcomed 12.54 million international overnight visitors, a 5% increase from the same period last year. Hotels recorded 29.03 million occupied room nights, up 4% year on year, with an average occupancy rate of 78.5% — among the highest globally.

DET said the new incentive will help maintain this momentum by attracting more investors to develop hotels in emerging areas, expanding accommodation options, and meeting future visitor demand under the Dubai Economic Agenda D33.