Dubai: Dubai hotel room rates have fallen from their New Year highs, but demand remains strong until the end of March due to the Expo. Until then, occupancy rates will hold at 2019 levels as the global event wraps up on March 31.
After that, there will be “the expected drop in Ramadan in April, and summer seasonality will come into play with lower occupancy rates,” said Philip Wooller, area director for the Middle East and Africa at STR. Even then, “it will be similar to 2021 – the year should then end strongly from the third quarter”.
Hotel rates are expected to drop over the coming week, with some of the city’s upscale hotels, such as the Kempinski in the Mall of the Emirates and the Intercontinental at Dubai Marina, offering rooms for around 1000 Dh at night. A room at the Habtoor Grand Resort, located at JBR, is available for just 990 Dh after January 10, compared to the New Years peak rate of almost 5,000 Dh.
While more than half of the city’s premier hotel properties are still full, there are more budget options available. Radisson Blu Deira offers rooms starting at just Dh388, while Dusit Thani, located in the Trade Center area, has a starting rate of over Dh550.
February rate indicators
Room rates will increase slightly during the first week of February, with Taj Dubai at Business Bay and Jumeirah Mina A’Salam charging between Dh1,000 and Dh1700 per night.
There are also great deals on luxury stays. The Meliá Desert Palm hotel will cost guests around 580 Dh and the Retreat Palm Dubai MGallery by Sofitel around 900 Dh more.
“The challenge for Dubai in 2022 will be to create enough demand in the fourth quarter to match the spectacular effect of the Expo during the same period in 2021,” Wooller said. “The FIFA World Cup in Qatar in December will undoubtedly put the Middle East in the spotlight of the world. “
The biggest football tournament could attract more than a million tourists to Qatar and will cause excessive demand for major transit hubs in Dubai and Abu Dhabi.
The increase in Omicron cases around the world will also force the travel and tourism industry to rethink its strategies. “The earlier outlook for what appeared to be a clear and stable path to normalization is likely to see increasing headwinds,” Shady Elborno, Emirates NBD analyst, said in a research note. “So far, all tourism statistics for Dubai released up to November, before the global appearance of the Omicron variant, indicate a very strong recovery in key tourism indicators.”
According to the latest data available, the number of hotels is doing well. The occupancy rate in Dubai jumped to 85.7% in November, from 80.7% in October and 67.2% in September, according to STR.
Revenue per Available Room (RevPAR) rose 15% month-over-month in November, marking the metric’s fourth consecutive increase. “The hospitality sector in November benefited from a combination of factors led by Expo 2020, improved COVID-19 measures (before Omicron), a resumption in international tourism attendance and a program responsible for events and conferences, ”Elborno said.
Expo 2020 is at the midpoint, with nearly 9 million visits in its first three months, organizers said last week. Since the opening last October 1, a total of 8,958,132 visits have been recorded, boosted by events throughout the December holidays. More sporting, musical and cultural performances are expected in the second half of its six months.