InterContinental is set to open its first residences in Abu Dhabi amid strong demand for luxury property across the country.
The InterContinental Residences Abu Dhabi will feature 130 units ranging from studios to three-bedroom apartments.
“I believe there is solid demand for luxury residential facilities. Having a hotel with adjacent residences is a common model within the IHG brand across the globe,” Dani Demerjian, general manager of the InterContinental Abu Dhabi, told The National in an interview.
“There is a need for hotel/residences and it was evident during Covid that business was flowing and guests needed the diversity of rendered services and facilities.”
The company has registered strong interest for longer stays, especially among residents.
“The UAE remains one of the most welcoming and cosmopolitan countries in the world, especially for existing and new entrepreneurship businesses, where their head offices are based in the UAE and, accordingly, attracts expatriates in light of further ease of visa facilitation,” he said.
“We are forecasting guest length of stay to vary from three to 12 months. However, we will avail a shorter length of stay as well.
“We plan to fill the residences gradually, ensuring memorable experiences are extended to all guests.”
The residences will offer stays for as short as seven days while contracts can go for as long as a year.
Located in the Al Bateen area of the capital, the InterContinental has played an interesting role in regional history.
It played host on May 25, 1981, when six Gulf rulers came together and formed the Gulf Co-operation Council in one of the hotel's ballrooms.
The hotel underwent a full renovation in 2007 but the Dar El Istiqbal ballroom, which was the birthplace of that union, remains almost untouched.
IHG's new property was originally planned to be a hotel as well, but was later converted into the current residences.
Residents can use all of the hotel amenities, along with those at the property, such as a pool and a private beach.
The branded residence sector has grown by more than 150 per cent during the past 10 years and has proved to be resilient in the face of global uncertainty and change, property consultant Savills said in its Spotlight on Branded Residences late last year.
The study ranked Dubai as the number one city globally for branded residences, with more than 40 projects completed.
Globally, developers and brands were seeking regions with large numbers of high-net-worth individuals, the report said.
Over the past five years, the highest growth rates in terms of number of HNWIs were noted in North America (53 per cent), followed by the Middle East (34 per cent) and the Asia-Pacific region (31 per cent).
The UAE is expected to record a 22 per cent rise in the number of high-net-worth households in the next five years, Savills said.
Financial wealth in the UAE is expected to accelerate at a compound annual rate of 6.7 per cent to $1 trillion in 2026, from $700 billion in 2021, management consultancy Boston Consulting Group said in a report last July.
The rapid expansion is being driven by growth in financial and real assets.
About 41 per cent of the UAE’s wealth was derived from ultra-high-net-worth individuals in 2021 and this is expected to grow to 43 per cent by 2026.
Branded residences are a good fit in the UAE because of the level of lifestyle among residents, Mr Demerjian said.
“The lifestyle is at its highest, and the luxury comes as part of the lifestyle and the readiness of guests to have a work life balance with excellence,” he said.
Rental prices in Abu Dhabi were generally stable in 2022 amid a wider economic recovery following the coronavirus-induced slowdown.
On a quarterly basis, they rose 1.6 per cent on average across the city in the third quarter of 2022, ValuStrat noted in its Abu Dhabi Real Estate Review Q3 2022 report.
Among the apartment locations monitored, asking rents rose on a quarterly basis in all the areas with the exception of Saadiyat Island, it said.
As for villa rents, the only monitored area that registered a negative trend was Al Reef.
The yearly asking rents averaged Dh50,000 ($13,610) for studios, Dh72,000 for one-bedroom units, Dh109,000 for two-bedroom units and Dh152,000 for three-bedroom apartments.