Increase in Tourists Leads to 15 Per Cent Growth in Demand for Dubai Hotels

The number of tourists taking Dubai holidays is expected to surpass the 8 million figure by the end of 2011 and hotels in the Middle Eastern city are expecting the individual room revenue to increase by eight or nine per cent by the end of the year.

According to STR Global, the number of international travellers visiting Dubai is expected to reach over eight million by the end of the year and the influx of tourists is having a positive impact on hotel room revenues in the city.

In its latest forecast, STR Global says that the steady flow of tourists taking Dubai holidays has led to a 15 per cent increase in the demand for hotel rooms for the full year.

Dubai hotels are expecting to see revenue from available hotel rooms increase to 8 or 9 per cent in 2011. Data from STR Global predicts the new hotel room supply growth next year to reach 9.6 per cent.

According to the data, there are 13,000 rooms in the emirate that are currently under construction and a further 21,000 are in the pipeline.

Image by: Brent73, on Flickr

The demand for hotel rooms from tourists taking Dubai holidays increased by 16.5 per cent in the months leading up to August, 2011 compared to the same period last year.

The report revealed a 17.6 increase in the number of travellers seeking luxury hotel rooms; 9.4 per cent for average Dubai hotels; and 11.3 per cent for economy hotels in Dubai, compared to last year’s figures.

The STR Global report stated: “Branded economy and midscale hotels have been growing in the past few years as Dubai diversifies its hotel offering, which was until recently focused mainly on upscale to luxury segments. The additional new supply in the midscale/economy segments combined with slightly lower demand than the market resulted in an average room rate decline of 2.7 per cent and the lowest absolute level of occupancy at 69.0 per cent.”

Image by: Theodore Scott, on Flickr

Elizabeth Randall, the Managing Director of STR Global, explained: “The Dubai hotel market has managed to leverage its strategic location as a hub between continents and was valued as a safe destination during the Arab Spring.

“In addition, modern infrastructure, new hotel inventory and delayed openings have allowed the market to balance supply and demand. This is good news for hoteliers who can now build their occupancy and rate.”

International tourists taking luxury holidays in Dubai are expected to spend a total $7.8 billion in 2011, marking a 24 per cent increase on the $6.3 billion spent in 2010.