Specialists in the hospitality industry across the GCC have termed the environment for hospitality investment as “promising”.
The outlook is positive ahead of the two major global events — the Expo 2020 in Dubai and the 2022 FIFA World Cup in Qatar. In addition, stakeholder, asset managers, owning companies and operators are confident of the growth beyond the major regional international events.
QATAR
Katara Hospitality chief operating officer Hamad Abdulla Al-Mulla said the outlook for the hotel industry in Qatar is “especially promising” for 2017. “The region’s fundamentals are strong, making it an attractive investment destination. In Qatar for example, the outlook for the hotel industry is especially promising. According to the Ministry of Economy and Commerce, in 2015, income from tourists amounted to US$5.03 billion (QAR18.3 billion) in 2015, nine-times the $.58billion (QAR2.1 billion) recorded in 2010, demonstrating the clear opportunity for proven investors like Katara Hospitality in the region,” said Al-Mulla.
Filippo Sona, director, head of hotels MENA Region, Colliers International said that while global macroeconomic conditions may have caused projects to slow down in 2016, “developers have to continue their plans if they want to capitalise on the World Cup 2022”.
He added: “For existing hotels, the key to a satisfying 2017 is to prepare budgets focused on cost balancing strategies. This will entail a closer communication and marketing with customers via social media, attempting to minimise OTA costs.”
Al-Mulla agreed that 2016 “will be remembered as a challenging year for hospitality investors as a mix of global geopolitical and economic issues has resulted in a more cautious approach towards investment decisions”. However, he revealed that Katara Hospitality’s “healthy diversification strategy” delivered continued success and growth.
He added: “This business-driven approach ensures that a balance is met across assets of short- and long-term profitability and that the company’s cash flow projections adequately support its development. However, Katara Hospitality continues to identify new opportunities to create lasting value. Our current portfolio includes assets in Qatar, Europe, Africa and Asia, and we are continuously evaluating opportunities in emerging markets, which reflect and fit with our strategy of creating a portfolio of iconic hotels in prime locations. We also see opportunities in refurbishing hotels to restore them to their former glory and have developed a reputation for this type of investment.”
Katara Hospitality is investing in a phased renovation at The Ritz-Carlton, Doha to be completed in 2017, in addition to developing 18 new villas at the Sealine Beach Resort in Qatar. The group is also developing the Katara Towers development in Lusail Marina District.
Outlining the country’s future plans for hospitality, Qatar Tourism Authority head of tourism investment promotion Mohamed Al Mahmeed apprised delegates on the strides made by the authority in recent years. Al Mahmeed said: “Qatar has a clear strategy to develop a sustainable tourism industry through 2030. The past year saw several key developments: the growth of the cruise tourism sector, measures to ease entry to Qatar — including the introduction of a new transit visa — and a new hotel grading and classification system. The focus for us moving forward is to support the diversification of the hospitality sector’s offering and the development of new tourism products.”
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