Alpen Capital’s GCC Hospitality industry report, which was released on Sunday, highlighting the importance of the growing demand of luxury brand hotel in the region said that while international players are aggressively establishing their brands in the GCC, local players like Jumeirah and Rotana have made a mark not only in the GCC markets, but have made themselves known globally driven by their impressive hotel operations.
“With the improvement in economic conditions, business and consumer sentiments are showing signs of revival. This is likely to boost domestic as well as inter-regional tourism in the GCC region, which will contribute significantly to tourist arrivals. In addition, as economic conditions improve globally, international tourism is likely to increase from both emerging as well as developed markets.”
Tourist arrivals in the GCC are also increasing on emergence of the region as a preferred tourist hub due to varied offerings for tourists. These range from shopping festivals to annual sporting events to conferences and exhibitions attracting both leisure and business travelers.
“Driven by the efforts undertaken by governments in countries such as the UAE and Qatar, the region’s aviation industry has undergone a drastic change with carriers such as Emirates Airlines, Qatar Airlines and Etihad turning into global carriers. These companies have facilitated the countries transformation into successfully global hubs for millions of transit passengers,” it added.
“Demand for hotels is also likely to be driven by higher arrivals from Asian nations as travel spend is likely to grow at an impressive rate driven by rising income levels. There is a growing domestic demand for hotels which is likely to be driven by rising income levels in the GCC region and the fact that per capita income in GCC nations is higher than most advanced economies,” the report said.
From the supply perspective, the ongoing development of the hotel pipeline across the luxury, midscale and economy segments is a positive.
“Hotel room supply in the GCC region, primarily in the UAE, is geared towards luxury hotels due to strong demand for such accommodation and the fact that the UAE is recognized as a premium tourism destination. Nevertheless, given the economic slowdown, the anticipated budgetary cuts by individuals and businesses and the consequent down-trading, hoteliers are strengthening their budget hotel pipeline to meet demand,” the report said.