Dubai baits developers to fast-track hotel projects
Properties that are completed sooner will receive bigger financial rewards
The government of Dubai has announced an incentive to boost mid-range hotels, or those in three- and four-star categories.
The programme, implemented on October 1, gives eligible hotels a concession on the standard 10 per cent municipality fee levied on the room rate for each night of occupancy. New hotels are also granted a waiver for a period of four years from the date the permit to construct is granted, provided the permit is dated between October 1 this year and December 31, 2017.
A collaborative effort between the Dubai Department of Tourism and Commerce Marketing (DTCM) and Dubai Municipality, the initiative is designed to advance the construction timelines of three- and four-star hotels. It is in line with DTCM’s strategy to realise Dubai’s Tourism Vision 2020, which aims to attract 20 million visitors per year by 2020.
“The equation is simple: the sooner the property opens, the bigger financial incentive the hotel owner will receive,” said Hilal Saeed Al Merri, Director General of DTCM.
“A number of hotel properties are either under construction or in the planning stages in Dubai and, under the directive of His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, this incentive has been designed to bring those properties to market sooner.
“While our Tourism Vision has an end date of 2020, our strategy is focused on continual growth year-on-year, and we want to see the destination offerings broaden every year,” said Al Merri.
The announcement comes in the wake of a new hotel classification system announced in Dubai, which now includes budget accommodations as well as very high-end hospitality options.
Hotels have been classified under a five-star system, but budget hotels are not part of this scheme. The new classification system adds new criteria, including resorts, guest houses, timeshare property, youth hostels, self-catering and university campus accommodation, in line with international practice. The system will also award gold or platinum status to exceptional five-star hotels and resorts.
