Department of Tourism and Commerce Marketing director general His Excellency Helal Almarri has said the authority will not regulate hotel pricing even if rates are doubled.
Speaking at the Arabian Travel Market, Almarri explained: “We are incentivising people to build more hotels and it’s demand and supply that will regulate pricing.
“I do not believe that Dubai is an expensive destination, especially when you compare it to other major cities."
Almarri did, however, admit that rising prices in the industry were a concern for DTCM.
“I do think that rising prices are a risk; pricing is one of the things that does worry us,” he added.
“Hotel prices have gone up in the last two years. Are we pleased with this increase? On the one hand we are happy the hotels are making money, but on the other hand, we feel there needs to be a fair analysis of demand and supply.
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“The way the hotel yield works is, based on the different times of year, they have different prices. Hotels manage their yield day by day and based on their inventory as well, and each hotel has slightly different policies,” explained Almarri.
However, Almarri said the market would eventually balance out as more hotels come online.
“What I believe is the market will not continue going up because the demand and supply will balance and the hotels are really savvy about this and they will get to the right balance.”
Dubai hotels welcomed more than 11 million guests in 2013. Under the current development pipeline for 2014-2016 there will be an additional 141 hotel establishments added to the market, including 99 hotels and 48 hotel apartments bringing the total to 751 hotel establishments and just under 114,000 rooms.
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