Marriott to double UAE hotels and add more than 13,000 rooms

The hotel operator expects to grow to 80 hotels in the UAE, accounting for 23,000 rooms, up from the current 38 hotels and 9,616 rooms.
Above, the Marriott Courtyard Abu Dhabi at the World Trade Center Mall. Delores Johnson / The National
Above, the Marriott Courtyard Abu Dhabi at the World Trade Center Mall. Delores Johnson / The National

Hotel operator Marriott International plans to more than double its hotels in the UAE, adding over 13,000 rooms.

The Nasdaq-listed entity, which is now the largest hotel operator by rooms after the merger of Marriott and Starwood Hotels and Resorts, expects to grow to 80 hotels in the UAE, accounting for 23,000 rooms, up from the current 38 hotels and 9,616 rooms.

In the Middle East and Africa it expects to have 393 hotels, accounting for 89,554 rooms by 2022, up from 238 properties and 51,877 rooms.

It also plans to hire another 30,000 employees in the region over five years. Of these, 6,000 people would be needed in the UAE.

There will not be any job cuts because of the merger, according to Alex Kyriakidis, the president and managing director for the Middle East and Africa at Marriott International.

Target markets include the UAE, Saudi Arabia, Egypt, Nigeria and South Africa, Mr Kryriakidis said.

“These are countries whose growth in GDP, population and investment in travel and tourism will help in super growth,” he said.

Of the merged Marriott International’s 80 properties in the UAE, 60 hotels and 17,000 rooms would be in Dubai by 2022. In Dubai, it currently has 30 properties in total.

“We are bullish about Dubai beyond 2020,” Mr Kyriakidis said. “The government is regenerating the whole area where 2020 Expo will take place, it is investing in another major airport, theme parks, malls, more leisure attractions, and continuing to grow Emirates as the airline and the hub in Dubai.”

In Dubai hotel owners are grappling with an oversupply of rooms.

For this year the gross operating profit per available room is forecast to drop 23.4 per cent compared to last year, according to research company Hotstats. The declines are expected to continue in 2017 and 2018.

With its 90 million people and a combination of sun, sea and archaeological interests, Egypt keeps Marriott’s confidence high. Last week, it announced a 252-room Ritz-Carlton in Sharm El Sheikh, expected to open by 2020.

“Small operators who don’t have the ability to perform in a market that has a shock are absolutely right going out of business,” Mr Kyriakidis said. “Conversely there is a significant interest in that market because it is a market where if safety and security is addressed, for instance, at Sharm El Sheikh, it will benefit. There is a lot of pent-up demand.”

Terror attacks have taken a toll on the tourism numbers in Egypt, especially in the Red Sea resort area.

The Cairo- developer Orascom Development Holding closed five of its six hotels at the Red Sea resort area of Taba last year. Spain’s Melia Hotels International disaffiliated three hotels in the Red Sea resort areas during the first half.

On Friday, Marriott acquired Starwood for US$13 billion. The merged entity now has 30 brands around 5,700 hotels and 1.1 million rooms globally, making it the largest hotel company in terms of number of rooms ahead of Hilton Worldwide and InterContinental Hotels and Resorts.

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Published: September 25, 2016 04:00 AM

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