Capital looks to ride cruise-ships wave

The MSC Lirica is one of the luxury cruise liners that has berthed at Mina Zayed port in Abu Dhabi. The current 2011-2012 cruise season has been Abu Dhabi's busiest to date, with 77 calls from cruise ships, which delivered 160,000 passengers to the emirate. Ravindranath / The NationalShow less

Abu Dhabi is promoting itself as a winter cruise destination as pressure mounts to boost hotel occupancy in the capital.

Tourism chiefs plan to visit the industry's global gathering in Miami, which starts today.

It comes as Abu Dhabi prepares to welcome P&O's 2,865-capacity Aurora liner to the temporary cruise terminal at Mina Zayed.

"We will leverage our host port and transit port capability," said Noura Al Dhaheri, an official at Abu Dhabi Tourism & Culture Authority, ahead of the Cruise Shipping Miami show. "Abu Dhabi hopes to pick up the winter cruise industry slack as traditional cruise markets in Europe, the Caribbean and North America slow down."

The current 2011-2012 cruise season has been Abu Dhabi's busiest to date, with 77 calls from cruise ships, which delivered 160,000 passengers to the emirate, according to the tourism authority.

The capital attracted record numbers of tourists last year, but the addition of thousands of new rooms has put rates under pressure - especially at the five-star end of the market.

More than 2.1 million guests checked into hotels in the capital last year, and it plans to attract 7.9 million hotels guests annually by 2030.

The Arabic financial newspaper Alrroya Aleqtissadiya yesterday reported no new hotel licences would be issued in Abu Dhabi until further notice, citing an official at the capital's tourism authority. A spokeswoman for the authority denied the report.

"We are still seeing interest in hotels in Abu Dhabi on a selective basis although probably not as much in the five-star sector," said Stephen Flanagan, the director of professional services at the Abu Dhabi office of Knight Frank, an international property consultant.

"Five stars are really struggling and there's still downward pressure on rates. There are also lots of cases where hotels have got licences but construction has stalled because of that downward trend and a lack of finance - so a lot could hit the pipeline if work restarted," he said.

Abu Dhabi hotel occupancy in January was about 66 per cent, or the same as a year earlier, while the average nightly room rate was down by about 6 per cent to Dh503 (US$136.94). Overall, hotel revenues gained 11 per cent for the month to about Dh408 million as the capital benefited from a number of high-profile sporting and business events. Average room rates in Abu Dhabi were down last year compared with 2010 as hotels cut their rates to remain competitive.

That pressure is expected to remain as thousands of more new hotel rooms are delivered.

As many as 6,682 hotel room were originally slated for delivery in Abu Dhabi this year with more than two thirds of them in the five-star segment, according to Knight Frank data. However, many projects have been stalled or stopped.