Altogether, Viability Management Consultants canvassed 134 hotel chains, large and small, international and local, that are active in this region for the 2014 edition of the GCC Chain Hotel Pipeline Survey.
This was a record number, representing a 15% increase over last year. Of these, 72 companies — or 54% of the total — confirmed new hotel projects coming up under their management.
Between them, these operators will be opening 391 hotels and hotel apartment buildings with 101,123 keys across the six GCC states between now and 2019. This is the first time ever that the pipeline has broken the 100,000 unit barrier.
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By comparison, the previous record numbers were registered in 2009, with 325 pipeline hotels containing 92,016 keys.
2014 was the first year in which we conducted a full GCC survey that included all kinds of transient accommodation letting units, i.e., hotel rooms, suites, apartments and villas, whereas historically we had excluded the latter two unit types. We felt it more logical to include them this time, as they have become ‘mainstream’ for most operators.
As per the chains’ current expectations, almost 80,000 or 80% of the pipeline should materialise between 2014 and 2016, with the remainder opening by 2019. Major deadlines like those of Expo 2020 in Dubai and the 2022 World Cup in Qatar should help ensure that construction programmes do not slip as much as usual.
Some 61% of the pipeline keys will be rated five-star, 30% four-star, just 9% three-star (mainly comprising the 10 Premier Inns in the pipeline), and just one two-star property, the Swiss-Belinn Ghubrah Muscat.
However, both Wyndham Hotel Group and Emaar Hospitality Group have significant budget hotel pipelines, but these were excluded as per the rules of our survey because they could provide no details on an individual property basis.
Wyndham is opening nine Days Inn hotels with a total of 800 keys, as well as 19 Super 8 hotels totalling 900 rooms, all in Saudi Arabia with investment partners there. Both brands are new to this region. Emaar is partnering with another Dubai government development company, Meraas, to open a reported five budget hotels in the city under a new brand called Dubai Inn.
Union Properties, another leading Dubai developer, has also promised to build 1000 ‘affordable’ hotel rooms in the next five years. It is worth noting that there continues to be major investment in budget hotels across the GCC, but mostly by owner-operators with no chain affiliation.
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