The market for budget hotels in Dubai and Abu Dhabi is growing as stopover traffic and low-cost air carriers expand.
The market for budget hotels in Dubai and Abu Dhabi is growing as stopover traffic and low-cost air carriers expand.

Big market for low-cost hotels in Dubai and Abu Dhabi



Budget hotels in the Dubai and Abu Dhabi stand to be the big winners from the growth in stopover traffic and the rapidly expanding low-cost carrier business, analysts and hoteliers say.

As a result, there is room for much more budget accommodation in the UAE and the wider region, as the phenomenon of jumping on a cheap flight and taking several short breaks a year, which is now well-established in Europe, starts to take off in the region.

A number of budget properties have launched in Dubai this year, including an easyHotel, and new Premier Inn and Holiday Inn Express lodgings next to Dubai International Airport.

"We will see more traffic coming through this market," said Rob O'Hanlon, the partner for the tourism, hotel and leisure industry at Deloitte in the Middle East. "Provided we're able to capture it there's business to be had."

Abu Dhabi is still undersupplied in the sector, but there are two Premier Inn hotels planned, including one at Abu Dhabi International Airport.

However, in the short-term, the rapid expansion in the budget sector in areas such as Barsha in Dubai has forced hotels into price wars.

Last month, a Citymax hotel, which is retailer Landmark Group's new budget accommodation brand, opened a property with almost 700 rooms opened in Bur Dubai, charging just Dh150 a night. That has now gone up to Dh192. But this is putting pressure on older hotels in the area.

"What you see is now with the new mid-market brands entering the market, that possibly established two and three star hotels that have been for 10 years and longer, it's a wake-up call for them, because they have possibly neglected their up-keep," said Michael Weyland, the general manager of the hotel division at Landmark Group.

He said the launch of such large, more affordable hotels would also help the conferences sector, as well as tourism to the emirate.

"There has been a lot of new supply that has come into the market in a short time and that has put certain pressure on rates," Darroch Crawford, the managing director of Premier Inn Middle East, a joint venture between Premier Inn and Emirates Airline.

But, he explained, compared to more established markets such as North America, Dubai still had some catching up to do in terms of budget hotels,

"There's not a lot of new properties planned. I think there's still more opportunity. What the low cost airlines have done is grow demand. They don't just steal business. They grow business."

Mr O'Hanlon noted that with the growth of low cost carriers it would often be more expensive to fly between Delhi and Mumbai than it would be to fly out of India to Dubai.

"We're just starting to see the rise of the low-cost airlines. Suddenly we're getting a lot of people who have the opportunity to travel. As hoteliers how are recognising potential and making sure we have got the product that people want to buy?"

Temple numbers

Expected completion: 2022

Height: 24 meters

Ground floor banquet hall: 370 square metres to accommodate about 750 people

Ground floor multipurpose hall: 92 square metres for up to 200 people

First floor main Prayer Hall: 465 square metres to hold 1,500 people at a time

First floor terrace areas: 2,30 square metres  

Temple will be spread over 6,900 square metres

Structure includes two basements, ground and first floor 

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The Details

Kabir Singh

Produced by: Cinestaan Studios, T-Series

Directed by: Sandeep Reddy Vanga

Starring: Shahid Kapoor, Kiara Advani, Suresh Oberoi, Soham Majumdar, Arjun Pahwa

Rating: 2.5/5 

The Bio

Favourite Emirati dish: I have so many because it has a lot of herbs and vegetables. Harees  (oats with chicken) is one of them

Favourite place to go to: Dubai Mall because it has lots of sports shops.

Her motivation: My performance because I know that whatever I do, if I put the effort in, I’ll get results

During her free time: I like to drink coffee - a latte no sugar and no flavours. I do not like cold drinks

Pet peeve: That with every meal they give you a fries and Pepsi. That is so unhealthy

Advice to anyone who wants to be an ironman: Go for the goal. If you are consistent, you will get there. With the first one, it might not be what they want but they should start and just do it

Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.