Emaar Properties, Dubai’s largest listed developer by market capitalisation, sold its 169-room Address Sky View hotel in Downtown Dubai for Dh750 million ($204m) to Evergreen Hospitality.
The deal is "in line with the company's asset-light strategy for hospitality assets", Emaar said in a statement to the Dubai Financial Market on Wednesday, where its shares trade.
Emaar will continue to manage the property and will retain ownership of a sky bridge restaurant. The value of the latest transaction represents 1.4 per cent of the company’s net assets and is expected to be completed by January 15, the company said in its regulatory filing.
“The net impact on the financial position would be an expected increase in assets of Dh50m during the quarter of sale transaction payment [fourth quarter of 2020],” it said.
Emaar Properties had traditionally owned its hotel sites but in 2019 it decided to sell off five prime hotel buildings. The properties – the Address Dubai Mall, Address Boulevard, Address Dubai Marina, Vida Downtown and Manzil Downtown hotels – contain about 1,000 hotel rooms and were sold to Abu Dhabi National Hotels for Dh2.2 billion.
The company's hospitality arm continues to manage the properties.
Emaar Properties is also divesting other assets deemed to be non-core to pursue growth opportunities elsewhere.
The company divested its district cooling business in Downtown Dubai for Dh2.48bn to National Central Cooling Company, also known as Tabreed, in April last year. Tabreed bought an 80 per cent stake in Emaar’s cooling assets.
The hospitality sector has been hit hard as countries close borders and introduce travel restrictions in the wake of the coronavirus pandemic. In November, the World Travel and Tourism Council said the industry had lost more than $3.8 trillion in gross domestic product and more than 142 million jobs globally as a result of the pandemic. A further $4.7tn and 164 million jobs could be lost this year if there is no improvement in conditions, the organisation said.
Tourism is rebounding in the UAE, however, and the country’s economy is projected to grow 2.5 per cent in 2021, according to the Central Bank of the UAE.
The UAE is also promoting staycations among its residents to boost hotel occupancy. Consultancy STR said last month that during the week of the UAE's National Day celebrations, occupancy levels in Abu Dhabi reached 69 per cent and Dubai hotels were 65.8 per cent occupied.
"International travel has been in the crossfire of the pandemic, but the UAE has done a fine job in generating domestic demand and staycations to move the occupancy line in the right direction," Philip Wooller, STR's area director for the Middle East and Africa, said.
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Skewed figures
In the village of Mevagissey in southwest England the housing stock has doubled in the last century while the number of residents is half the historic high. The village's Neighbourhood Development Plan states that 26% of homes are holiday retreats. Prices are high, averaging around £300,000, £50,000 more than the Cornish average of £250,000. The local average wage is £15,458.
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The flights
Flydubai flies to Podgorica or nearby Tivat via Sarajevo from Dh2,155 return including taxes. Turkish Airlines flies from Abu Dhabi and Dubai to Podgorica via Istanbul; alternatively, fly with Flydubai from Dubai to Belgrade and take a short flight with Montenegro Air to Podgorica. Etihad flies from Abu Dhabi to Podgorica via Belgrade. Flights cost from about Dh3,000 return including taxes. There are buses from Podgorica to Plav.
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While you can apply for a permit for the route yourself, it’s best to travel with an agency that will arrange it for you. These include Zbulo in Albania (www.zbulo.org) or Zalaz in Montenegro (www.zalaz.me).
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info-box
COMPANY PROFILE
Company name: Happy Tenant
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Sector: Technology, real-estate
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Key facilities
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Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law