Dubai: With more hotels on the market, room rates have fallen since last year.
"Room rates were way too high," said Naeem Darkazally, Rotana Area Director of Sales and Marketing for Dubai and Northern Emirates.
"Around the middle of 2009, the rates started to even out and there was a correction in the market. Now, room rates have come back to normal, how they should be," Darkazally said.
Darkazally believes that this correction is necessary for the market. "Dubai should remain an affordable destination. We shouldn't just be offering exclusive, expensive accommodation," he said.
According to STR Global, a consultancy for the hospitality sector, Dubai's occupancy rates remained the same at 82.1 per cent from November 2008 to November 2009.
The average daily rate (ADR), which is the room revenue divided by rooms sold, saw a 19.3 per cent decline from $365.40 (Dh1341) in November 2008 to $294.8 in the same month in 2009.
The revenue per available room (RevPAR) which is the room revenue divided by rooms available, also saw a 19.4 per cent decrease from $300.17 in November 2008 to $241.92 in November 2009.
"In 2009, we saw a drop of 5 per cent in our occupancies across the board. But the real impact was the increase in inventory," Darkazally said.
Certain events have helped boost hotel occupancy considerably. Eye of Dubai, a web portal that provides information about the emirate, reported a 300 per cent increase in the number of hotel reservations made through the website for the inauguration of the Burj Khalifa.
Over 12,000 people were at the Burj to witness the historic event and hotels reported an average 90 per cent occupancy for the night of January 4.
"It's a fantastic addition for us," said Omar Kaddouri, Senior Vice-President of UAE Operations at Rotana, speaking of the Burj Khalifa.
Rotana recently inaugurated the world's tallest hotel, the Rose Rayhaan, located five minutes from the Burj Khalifa. "It's a very big benefit," he added.
Rotana, which operates 1,344 rooms on Shaikh Zayed Road, is expected to expand its operations in Dubai this year.
"Rotana will be operating 11 hotels in Dubai, with two more scheduled to open during the first quarter of 2010, which will add 547 rooms to Rotana's inventory in Dubai," Kaddouri said.
"Certainly there are a lot of hotels in Dubai, but we continue to have business," said Daniel Mathew, General Manager of Rose Rayhaan.
"You just have to open up new avenues, be more creative and look at other areas and niches which do not exist in Dubai.
"This way we have been creative by building the tallest hotel, in a good location, offering decent rates," he added.
Better times ahead
- 19.3%:drop in ADR inNovember 2009
- 1,344: Rotana's available rooms on Shaikh Zayed Road
Inside the tallest hotel
As world's the tallest hotel, the main selling point of the Rose Rayhaan is the view. All 482 rooms offer views over the buildings lining Shaikh Zayed Road, the Burj Khalifa and its environment, and out onto Dubai's coast. The higher you go, the more exhilarating the views. Take a lift up to the 65th floor where four suite rooms and two premium suites offer towering views.
Each room comes furnished in earthy hues and is generous in size with the premium suites offering walk-in wardrobes and sizeable bathtubs. All rooms feature a range of modern amenities, a small kitchenette area and a luxury bathroom.
The rooms also include high speed broadband internet, IP telephone, multi-channel satellite television, complimentary tea and coffee making facilities, fully stocked mini fridge, in-room safe, laundry and dry cleaning services, daily housekeeping as well as bathrobes and hairdryer.