Abu Dhabi-based hotel operator Rotana is ramping up its expansion plans in the UAE with 12 new hotels at an end value of US$1.7 billion.
Rotana will open seven new hotels in Dubai, four hotels in Abu Dhabi and one in Ras Al Khaimah by the end of 2020 despite a current challenging “economic environment”, it said in a statement.
When they are finished, the new hotels will add 4,360 keys to Rotana’s existing inventory, taking its UAE portfolio to 44 properties, including 21 in Dubai and 17 in Abu Dhabi.
The hotels group said it will own 11,782 rooms in the UAE including 6,682 in Dubai and 5,100 in Abu Dhabi.
In Dubai, Rotana plans to open a 280-room hotel in the Dubai Creek area, a 605-room hotel in Wafi City, a 338-room hotel in Al Jaddaf, a 590-room hotel on Sheikh Zayed Road, a 308-room hotel and 407 serviced apartments in Umm Sequeim and a 260-room Centro hotel in Jumeirah Village Circle.
In Abu Dhabi, Rotana plans to open a 350-room hotel at Abu Dhabi National Exhibition Centre, a 326-room hotel in Al Zahiya, a 376-room hotel in the Marina Mall area and its delayed 354-room Saadiyat Rotana Resort & Villas on Saadiyat Island.
Rotana plans to open a 200-room hotel in Ras Al Khaimah.
The news comes despite gloomy figures from hotel experts who say that occupancy levels across the UAE have fallen this year due to the slowing economy and increase in hotel supply.
Occupancy in UAE hotels fell by 2.9 per cent to 75.6 per cent in October and the average daily rate (ADR) declined by 9.6 per cent to Dh668.05, the lowest for the month of October since 2005, according to data from research company STR. Revenue per available room – a key industry performance indicator – plunged by 12.3 per cent to Dh505.34 in October, the 22nd month in row in which year-on-year ADR has dipped as supply has grown.
“Despite the challenging economic environment, the outlook for the hospitality sector in Dubai and Abu Dhabi remains positive,” said Omer Kaddouri, Rotana’s president and chief executive.
“In previous UAE Real Estate 2016 midyear market reviews, global consultancy firms listed the medium-to-long term outlook for the hospitality sector in Dubai and Abu Dhabi as positive, citing the opening of theme parks and new tourist attractions as the main factors driving demand.”
lbarnard@thenational.ae
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