Dubai's hospitality industry is looking to a period of sustained growth, with a raft of new hotels set to open in the next few years, and foreign arrival numbers tipped to rise. However, while enjoying buoyant times, the emirate's hotel sector still has some issues to deal with and concerns to ponder.
With as many as 10m foreign tourists expected to visit Dubai in 2010, there has been a surge in new hotel construction. Based on approved or planned projects, the number of hotel rooms in the emirate is projected to rise from 51,168 in 2007 to 64,179 by 2010.
This expansion has prompted Dubai's Department of Tourism and Commerce Marketing (DTCM) to announce it will establish a new system of rating hotels, aimed at better reflecting enhanced international standards.
On June 8, Khalid bin Sulayem, the DTCM's director general, told a hospitality conference in Dubai that the present ratings system had been under review for some time. With the number of hotels and hotel apartments in Dubai set to rise to 488 over the next two years compared to the 452operating in 2007, now was the time for change, he said.
Under the new system, hotels will be classified as either leisure, city/business or 'other' properties, with separate sub-sectors covering niche accommodation products such as theme park hotels, boutique hotels, budget hotels, wellness and spa hotels and heritage hotels.
Sulayem dismissed suggestions that the hotel sector was outgrowing itself, saying the expected rise in tourism arrivals would allow it to sustain itself.
However, while a major contributor to the Dubai economy, the hospitality industry is also a high-end consumer of resources, most notably electricity and water.
As new infrastructure projects will maintain the sharp increase in utilities requirements, developers are being urged to give greater consideration to environmental issues.
According to Markus Oberlin, the general manager of energy conservation consulting company Farnek Avireal, the daily per capita water usage in the United Arab Emirates (UAE) is around 350 litres, but for hotels such as Dubai's Burj Al Arab it can be as high as 2000 litres.
Added to this, the average five-star hotel in the UAE emits around 6500 tonnes of carbon dioxide a year, compared to 3000 tonnes by a similar hotel in Europe.
By making use of energy efficiency measures and better water usage practices, hotels in Dubai and in the region could cut energy costs by 30%, lower toxic gas emissions and reduce the demands they place on scarce resources, Oberlin told local press on June 8.
Dubai's hospitality industry also has to contend with the perception of higher room prices than those of hotels in neighbouring states.
While acknowledging there was some substance to the comment, Sulayem said Dubai's hotels offered higher standards of quality and service than other destinations. He also cited the fact that there is an increasing number of hotels coming on line that are catering to the lower-end of the market, offering budget priced accommodation for the cash-conscious client.
Another note of warning has come from Rohit Talwar, the chief executive of UK-based tourism consultancy Fast Future, who said plans for massive expansion of the hospitality industry will be hard to sustain if the global economy slips into recession.
Talwar said hoteliers had to target markets away from traditional sources of foreign visitors such as Europe and the US to sustain their growth.
"With the opening of major developments such as Dubailand, it will be an increasingly popular destination for visitors from emerging markets," he said. "Where to look for customers is critical because tourists are no longer just the rich Europeans and Americans."
Though Talwar said "wow-factor" tours and attractions would help continue to bring in the crowds, it is a fact that tourism is a sector easily affected by hard times. While the policy of "if you build it they will come" has a lot of merit, Dubai's hoteliers must be ready to deal with the worst of times as well as the best.
