Luxury hospitality group Fairmont Hotels and Resorts has moved its global headquarters to Dubai, the Middle East's tourism and business hub, from its current location in Paris, as it seeks to tap into the region's booming hospitality industry.
The shift is a reflection of the key role the region plays in Fairmont's global strategy, as nearly 40 per cent of its current projects are being developed in the Middle East, Africa, India and Turkey, Mark Willis, chief executive of Fairmont Hotels, said in a statement to The National on Tuesday.
Dubai, “where majority of the global leadership team will sit”, beat other cities, including London and New York, as the group's preferred location for its global headquarters, Mr Willis said.
“Dubai was ultimately chosen for its strong position as a global hub, strategic proximity to Europe, Asia and Africa, allowing for easy access to a large portion of the world, and the city’s ability to attract top talent, brands, companies and investors,” he said.
“The relocation positions Fairmont to take advantage of the tremendous opportunities in the region.”
The move, which was officially announced this week, was made in parallel to a major restructuring of the company's dynamics in 2022 and the appointment of a new global management team in January.
Last year, Accor chairman and chief executive Sebastien Bazin introduced a new structure for the group, dividing the company into two divisions — premium, midscale and economy; and luxury and lifestyle.
Fairmont falls under the luxury and lifestyle category, headed by Mr Bazin, along with Accor's Raffles, Orient Express, Sofitel, MGallery, Emblems and Ennismore brands.
In January, Mr Willis was named Fairmont's global chief executive, after he stepped down from his role as Accor's chief executive for the Middle East, Africa, India and Turkey.
Fairmont plans to boost its network in the UAE as well as in Jeddah, Saudi Arabia, as it “continues to expand, with an eye on the many beautiful and attractive destinations around the world”, Mr Willis said.
Dubai's hospitality industry performed strongly in 2022, benefitting from an influx of tourists eager to travel after two years of pandemic-related lockdowns and attend mega events such as Expo 2020 Dubai and the Fifa World Cup in Qatar.
The emirate was ranked second last year in a list of the top-100 most attractive city destinations compiled by Euromonitor International. Dubai ranked behind Paris and ahead of Amsterdam, Madrid and Rome in the top five cities in the global index for 2022.
The emirate hosted 14.36 million international visitors last year, almost double the 2021 total of 7.28 million, and only 14 per cent below the pre-pandemic level of 16.73 million recorded in 2019, according to data from Dubai’s Department of Economy and Tourism.
In the first nine months of 2022, Dubai's economy expanded by 4.6 per cent on an annual basis, with wholesale and retail trade accounting for 24.1 per cent of its gross domestic product, data from the emirate's statistics centre showed.
Emirates NBD estimates Dubai's full-year 2022 growth at 5 per cent and expects the emirate’s GDP to grow by 3.5 per cent this year.
Dubai's D33 economic agenda aims to double the size of its economy with a target of reaching Dh32 trillion ($8.71 trillion) by 2033 and establishing the emirate among the top three global cities.
The 10-year strategy also seeks to establish Dubai as the world’s safest and most connected city and a preferred destination for major international companies and investments.
The UAE, the Arab world’s second-largest economy, has undertaken several economic, legal and social reforms in recent years to strengthen its business environment, boost foreign direct investment, attract skilled workers and provide incentives to companies to set up or expand their operations in the country.
Some of the reforms include the expansion of longer-term residency visas to broader categories of residents, wide-ranging changes to personal and labour laws, measures to allow full ownership of onshore companies by foreigners and the decision to change the UAE’s working week from Monday to Friday to align with other major economies.
Fairmont's headquarters was originally in Toronto, but was moved to Paris after Accor acquired its parent, FRHI Hotels and Resorts, in December 2015 for $840 million.
The acquisition, its biggest deal by far, strengthened its luxury portfolio as it brought the Fairmont, Raffles and Swissotel brands into the fold.
The transaction involved two major investors from the Middle East — Kingdom Holding, the investment company controlled by Saudi Arabia's Prince Alwaleed bin Talal, and the Qatar Investment Authority (QIA).
Currently, Kingdom Holding and the QIA hold 6.3 per cent and 11.2 per cent stakes, respectively, in AccorHotels, according to its website.