Dubai's Deyaar has allotted up to one million square feet for hotel and serviced apartment projects in Dubai.
Dubai-based Deyaar Development on Saturday announced its decision to expand its portfolio beyond commercial and residential properties to hospitality projects.
The move, which comes as part of Deyaar's strategy to diversify its capabilities in the real estate sector, will be initiated within the Dubai market.
The company said it has allotted up to one million square feet for hotel and serviced apartment projects in prime locations in the city in the coming years.
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These include areas such as Business Bay, along Sheikh Zayed Road, as well as sites located in close proximity to the proposed venue for the Expo 2020 mega event.
Deyaar said in a statement that it intends to grow its hospitality portfolio "both organically and through acquisitions".
The developer's decision follows a call by Dubai's leadership for greater investment in developing more hotels as part of plans to attract 20 million tourists by 2020.
Deyaar added that it has several projects under consideration, and aims to forge international collaborations for future hotel projects.
Saeed Al Qatami, CEO at Deyaar, said: "We believe this is a positive step for Deyaar, and will give us an opportunity to demonstrate our ability to deliver on evolving market demands.
"Dubai has seen a phenomenal surge in occupancy rates, crossing the 80 percent mark in high-value areas in 2013. Deyaar certainly has the means to tap into this growing sector, and give our customers a bigger portfolio of investment options to choose from.
"We have a number of projects under consideration, which we hope to reveal soon. Some of these properties will be retained as fully-owned developments under Deyaar, while other projects will be sold to third-party investors."
Qatami added: "The demand for residential, retail and commercial properties is on the rise. Based on the sales results achieved last year, we can see that the buoyancy is certainly catching on. We are confident that with continued inflow of liquidity into the market, Dubai will sustain healthy growth in its real estate sector."
Last month, Deyaar reported a surge in its 2013 profit, as it benefited from completion of stalled projects and the handover of homes to customers.
Deyaar, one of the companies worst hit by Dubai's real estate market collapse of 2008-2010, made a net profit of AED154.5 million ($42.1 million) last year compared with AED38.6 million in 2012.
The company did not provide any fourth-quarter figures. But Reuters calculated, based on previous earnings statements, a quarterly net profit of AED67.4 million against AED5.5 million in the corresponding period of 2012.
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