Dubai close to its 100,000 hotel room mark
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The next month will see Dubai hit the 100,000 rooms milestone across its expanding hotel and hotel apartment inventory.
With this achievement, the city aims to position itself as a top 10 global destination in terms of available hotel supply, indicating high demand from international travellers and sustained growth in tourism volumes.
This trend, coupled with an ever expanding leisure, events and attractions destination offering that seeks to draw the longer-staying family and couples segments, necessitates a simultaneous increase in room stock to bridge existing deficit and ensure supply enables stronger tourism growth.
Over the next three years, Dubai’s Department of Tourism and Commerce Marketing (Dubai Tourism) expects occupied room nights in hotels and hotel apartments to reach 36.9 million, representing an 11-12% compound annual growth rate (CAGR) to 2018 end. As such, the overall room supply is expected to reflect similar growth, reaching 138,000 rooms by the end of 2018.
With demand increasing, overall projected occupancy rates until 2018 are expected to be around 77% despite growth in capacity, ensuring the emirate remains a highly competitive visitation draw. In the first quarter of 2016, Dubai’s hotels saw some of the highest global rates in occupancy, RevPar and average daily rates at 85%, AED520 ($142) and AED609 ($166) respectively.
“Structurally, healthy occupancy levels are a pre-requisite to absorb increased demand without price escalation, ensuring our destination remains appealing to global travellers. Our projected supply needs are based on maintaining a solid occupancy threshold despite a 40% increase in capacity which is very strong for the hospitality industry and is designed to ensure that the overall economic value for Dubai continues to be enhanced,” said HE Helal Saeed Almarri, director general, Dubai Tourism.
Dubai Tourism forecasts need for continued industry pipeline growth at a CAGR of 12.0% (2015-2018), in order for the destination to remain competitive. To this end, Dubai Tourism expects to expand overall Length of Stay (hotel nights) to four days by 2018, along with the volume growth in international overnight visitors.
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