For hotel investors in the UAE looking to invest, there's no better time to do so, reported JLL in its annual review of the UAE Real Estate Market for 2016.
Dubai's hotel market witnessed the completion of approximately 7,000 rooms in 2016, bringing the total hotel stock to 79,000 keys. Q4 saw the delivery of Jumeirah al Naseem, with 430 rooms, the Premier Inn Ibn Battuta, with 372 rooms, and Nikki Beach Resort with 117 keys. However the report adds that the 10% decline in RevPar in 2016 has affected hotels adversely.
However JLL senior vice-president — Middle East & Africa, Marko Vucinic said to Gulf News: "We expect the investment market to remain highly opportunistic for the medium term. Development projects will continue to remain at the forefront of investment activity in the coming years."
The report added that Abu Dhabi's hospitality sector has suffered from a reduction in corporate demand, driven by the decline in oil prices, reduced government spending and corporate consolidation. This has been offset by increased leisure demand, driven by the government's major initiatives to diversify towards leisure tourism.
According to Vucinic, Expo 2020 will see a definite increase in investment as investors will look to capitalise on the compressed demand over the six-month period.
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