Dubai hotels set for boom time on growing demand

Damac Properties on Monday announced plans to develop 8,000 luxury serviced hotel apartments to cater to the growing demand in the emirate as Dubai's current hotel capacity is expected to exhaust in the next three years, its top official said. The region's largest private developer of luxury property projects will cash in on the rising demand in the hospitality sector by adding 8.2 million sq. ft. through these serviced hotel apartments by 2016, in addition to the Paramount Hotel, which the developer announced recently. Damac Maison, the company's luxury management and services arm, will provide bespoke services to residents in 7,957 serviced hotel apartments across 8,280,507sqft by the end of 2016, with 2,810 serviced hotel apartments to be completed this year. This will position the company as one of the largest hotel apartment operators and developers in the world. "Even with more hotels coming online in the next few years, Dubai's exponential growth as an attractive global tourist and business destination will see demand exceed supply by 2016,” said Ziad El Chaar, managing director of Damac Properties. The property developer is focussing its delivery on hotel apartments in the Burj area of Dubai — a district that attracts more than 65 million visitors a year and has become the central hub for both visitors and tourists. The Signature in the Burj Khalifa area, Damac's first hotel apartments project, began handover last month, with 355 units overlooking the world's tallest tower. The project will be run by Damac Maison. "The luxury serviced hotel apartments sector is currently underserved, despite a huge desire for visitors to experience five-star services in the comfort of their own homes,” El Chaar said. His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has set the visionary target of 20 million tourists as Dubai bids to host World Expo 2020. The emirate is undergoing a resurgence in infrastructure development that includes major new master developments, hotels, world-class restaurants and theme parks. The region's premier property developer, Emaar Properties, in collaboration with Meraas Holding, also announced a new hotel brand — Dubai Inn — to meet the growing demand from global travellers. The new brand of hotels will be located in several areas around the city and supplement the growth in the hospitality sector. Another property developer, Nakheel, is also expanding its business portfolio with the creation of a new division — Nakheel Hospitality and Leisure — to focus on the company's growing number of hotels, beach clubs and community recreation centres. The Dubai Economic Council's recent report showed that real estate in Dubai has grown by 94 per cent in the fourth quarter of 2012 compared to the corresponding quarter in 2011, with the average price per square metre for apartments increasing by around three per cent. The latest Hotstats report on the hotel industry for the Middle East show that occupancy rates in the first quarter of 2013 stood at 83.9 per cent, up from 77.3 per cent in the same period last year. This was supported by the Ernst and Young Middle East Hotel Benchmark survey, which reported that Dubai's overall occupancy rate was at 83.6 per cent. "In just three years — in 2016 — Dubai will see a year that will reinforce Dubai's position as a global leader for luxurious hospitality, stunning real estate and unrivalled opportunities,” El Chaar said. "Luxury serviced apartments offer not only an ideal family living experience, but also a smart strategic investment,” he added. Damac is also expected to complete major developments, which include Capital Bay, The Cosmopolitan, Water's Edge and The Vogue. The Distinction, Upper Crest, Bay's Edge and the iconic Damac Towers by Paramount are also set to open by 2016. It has completed 8,890 units to date, spanning 9,070,264sqft. It also has a further 19,136 units at various stages of progress across the Middle East covering 23,816,070sqft, out of which 5,193 units will be completed this year. From Khaleej Times