AHIC PREVIEW: Meet the new speakers
NEW SPEAKER FOR 2014: Kabir Mulchandani, Group CEO of SKAI Holdings
The owner of Viceroy Dubai Palm Jumeirah, Kabir Mulchandani will be speaking on a panel entitled ‘Getting the mix right to make money’.
“The Middle East and Africa is one of the fastest growing markets for the hospitality industry in the world. There are currently 504 hotels — or 122,631 rooms — in the development pipeline, according to data from STR Global.
The success and the future of these hotels will rely heavily on how they are funded. In days gone by, building a hotel would be a costly and lengthy process, during which a building’s owner would not typically expect to break even for over a decade. Today with the huge development pipeline, developers have to look at alternative ways to fund their growth.
I will be speaking on a panel discussion about project financing, based on my own personal experience of raising major project investment from China.
SKAI Holdings is currently developing the Viceroy Dubai Palm Jumeirah, which has been funded through a mix of different entities, including traditional finance from the Industrial and Commercial Bank of China (ICBC), a special purpose vehicle, and a unique investor model that allows individual investors to purchase and lease back hotel rooms.
One of the most significant areas of focus looking ahead is from China. SKAI Holdings’ partnership with China State Construction Engineering Corporation (Middle East LLC), the main contractor of the Viceroy Dubai Palm Jumeirah, to form a special purpose vehicle ASSAS, together with US $201mn of financing from ICBC are examples of how we have leveraged the growing interest from China in this part of the world.
Our unique investor model, which allows buyers to purchase hotel rooms, which are then leased back in exchange for 40% of the room revenue, is also a growing area of interest for the industry. This model is one I expect an increasing number of developers to adopt as they look to grow their presence in the region.”
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NEW SPEAKER FOR 2014: Ziad El Chaar, Managing Director, DAMAC Properties
Responsible for developing 7351 serviced hotel apartments in Dubai by 2017, Ziad El Chaar will speak on a session to address ‘Succeeding in the extended stay and serviced apartment segment’.
“Dubai welcomed just over 4.7 million tourists in 2004; last year that number stood at more than 10 million and by 2020 that number will more than double again. Dubai’s growth, by any metric, has been exponential and the hotel investment landscape has grown with it.
The biggest change over the past decade has been the boom in the number of global operators setting up business in the emirate, bringing with them a quality and level of service not previously experienced. The bar has been set very high in Dubai, making the city one of the most attractive destinations in the world.
Over the next 10 years, as Dubai continues to grow and prepare to host the World Expo 2020, you can expect to see a strong growth in the number of serviced hotel apartments opening up.
We see this as a bigger driver in the tourism market in the coming years and are taking a leadership position at the luxury end of the sector. By 2017, Damac Maison — the hospitality arm of Damac Properties — will provide bespoke hospitality services to residents in 7351 serviced hotel apartments that are currently under development across the region.
On 30 December 2013, we opened our first luxury serviced hotel apartment project, Damac Maison — Dubai Mall Street. The fifty-storey tower looking out over the world’s tallest tower and the Dubai Fountain has fully sold out and the occupancy rates in the early months have been very pleasing.
Investors can purchase a fully-serviced unit and either live in it themselves, or add it to the Damac Maison rental pool, where we will rent it out for a management fee. Investors have found this flexibility hugely attractive and the other luxury serviced hotels we are developing which will complete later this year are already selling very well.”
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NEW SPEAKER FOR 2014: Fahd Al-Rasheed, CEO and MD, King Abdullah Economic City
A focus on Saudi Arabia — Fahd Al-Rasheed will reveal the opportunities offered by KAEC, one of the world’s largest privately led mega-projects
“Saudi Arabia is full of hospitality and tourism investment opportunities, and King Abdullah Economic City is about diversifying KSA’s income sources and creating jobs for the growing youth. Given that the hospitality sector is a strong contributor to growth and employment in any developed economy, it is definitely in our plans for the city’s current and future development.
We are looking to tap into Saudi Arabia’s massive domestic tourism potential through development of a bouquet of lifestyle destination-driven products within the city such as our upcoming Murooj Golf Course, Juman Park — a unique family leisure park, a resort property under planning, and our first yacht club and marina.
We are also focused on capturing a share of the growing Umrah market in our Haramain District where we will be connected to Makkah and Madinah by way of a high-speed rail.
Currently, we have Bay La Sun Hotel and Marina, which is the first premium business hotel in the City, and it has seen a very positive response from the corporate business community as well as government for the hosting of conferences, meetings, and events.
We aim to strengthen this category through amplified development and services catering to this sector. Further, there is a growing demand being generated from the industrial growth at KAEC. We have successfully attracted global and regional industrial anchors and as these projects undergo development, there will be a sizeable demand for accommodation.
In fact, we are actively seeking and developing strategic alliances — both with third party developers as well as joint venture partners to cater to this demand. We see an immediate demand for extended stay products as well as budget hotels in the city.
Developers are not obsessed with hotels being trophy assets alone and an increasing appetite for midscale, extended stay and budget hotels proves that all the stake-holders are willing to exploit the full potential of the economic opportunities.”