Dubai tourism is set to bounce back once airlines restore flights, says report

Dubai: Dubai’s tourism recovery in the second half of 2026 will depend heavily on the restoration of international air connectivity, with airlines gradually bringing back services after regional disruption affected passenger flows and hotel demand earlier this year, a new report says.

Dubai’s hospitality market is expected to regain momentum through the second half of the year, particularly from the fourth quarter as international connectivity improves and the winter travel season takes effect, according to the Dubai Hospitality Market Performance H1 2026 report by Cavendish Maxwell, using data from STR and Data.Dubai.

The report identifies the restoration of international air connectivity as the principal driver of Dubai’s hospitality recovery.

Airlines that suspended or reduced services to Dubai during the first half of 2026 are scheduled to progressively restore capacity during the second half, particularly from long-haul international markets that were most affected by the disruption.

Emirates has already restored approximately 85 per cent of its pre-conflict capacity and is adding further capacity, which the report says should support hotel occupancy, particularly in premium segments that rely more Long-term outlook

Ferras Hafez, associate director, Commercial Valuation at Cavendish Maxwell, said the recovery would depend on both connectivity and traveller confidence.

“Dubai’s hospitality recovery will depend on the timely restoration of international air connectivity and traveller confidence,” he said.

“However, the current slowdown should be viewed as a short-term, externally driven disruption rather than a change in the emirate’s long-term hospitality growth story, supported by resilient market fundamentals and a diversified tourism offering.”

Dubai is also continuing to expand its hotel pipeline, with around 39 hotels comprising approximately 9,520 rooms scheduled for delivery between 2026 and 2029. Around 3,150 rooms are expected to be completed by the end of this year.

The report says the pace of recovery will ultimately depend on the continued stabilisation of regional conditions, the restoration of international air connectivity and the strength of visitor demand. Any further deterioration in regional conditions could delay the recovery.heavily on international long-haul travellers.

Ferras Hafez, associate director, Commercial Valuation at Cavendish Maxwell, said the recovery would depend on both connectivity and traveller confidence.

“Dubai’s hospitality recovery will depend on the timely restoration of international air connectivity and traveller confidence,” he said.

“However, the current slowdown should be viewed as a short-term, externally driven disruption rather than a change in the emirate’s long-term hospitality growth story, supported by resilient market fundamentals and a diversified tourism offering.”

Dubai is also continuing to expand its hotel pipeline, with around 39 hotels comprising approximately 9,520 rooms scheduled for delivery between 2026 and 2029. Around 3,150 rooms are expected to be completed by the end of this year.

The report says the pace of recovery will ultimately depend on the continued stabilisation of regional conditions, the restoration of international air connectivity and the strength of visitor demand. Any further deterioration in regional conditions could delay the recovery.

Dubai’s hotel market is forecast to improve as the winter high season approaches.

By the end of 2026, hotel occupancy is expected to range between 60.4 per cent and 66.2 per cent, while average daily rates are forecast at Dh600 to Dh675.

The report expects annual averages to remain below the record levels achieved in 2025, mainly because of weaker performance in the first half of the year.

Dubai International Airport handled around 26.6 million passengers in the first five months of 2026, down from the previous year as regional airspace disruption and reduced international connectivity affected traffic.

Dubai’s hotel occupancy averaged 56.4 per cent in H1, while average daily rates fell 7 per cent to Dh701.

Despite the softer occupancy, hotel operators broadly maintained pricing rather than aggressively discounting rooms.

Measures introduced by UAE airlines have also been supporting traveller confidence.

The report notes that Emirates introduced travel cover in June, including conflict-related protection and disruption support, while Etihad Airways and Abu Dhabi’s Department of Culture and Tourism introduced complimentary medical travel insurance for eligible international visitors.

Government measures have also supported Dubai’s hospitality sector, including financial relief for hotels and restaurants and initiatives aimed at stimulating domestic, regional and international visitor demand.