New Rove Hotel to open at City Walk

Rove Hotels has announced plans to open a new property at City Walk in Dubai, although a projected launch date has not yet been disclosed.

Rove Hotels is a collaboration between Emaar Properties and Meraas, and the City Walk property will be the brand’s sixth in Dubai, joining Rove Downtown, Rove City Centre, Rove Trade Centre, Rove Dubai Marina and Rove Healthcare City. The Dubai-born brand offers mid-market hotels aimed at millennial travellers and has plans to expand to further locations both in the UAE and Saudi Arabia.

The new City Walk property will be located beside Dubai Arena, an all-purpose indoor air-conditioned arena due to open in 2019, and will include a 24-hour coffee shop and on-site grocery store, in addition to restaurants and cafés. "Rove Hotels has indeed set a trend in the hospitality industry by serving as a midscale contemporary brand that appeals to value-conscious travellers," says Paul Bridger, corporate director of operations, Rove Hotels. With the central locations of our hotels and the rich array of amenities tailored for guests, we are meeting the aspirations of the new generation of travellers. We have recorded strong market response and our hotels have also been ranked high in TripAdvisor ratings, highlighting their popularity."

The new property will also offer new opportunities for investors, Bridger explains. “Rove City Walk presents a remarkable hotel room investment opportunity in Dubai that is a first by Rove Hotels. By owning a guest room by the award-winning brand, investors can benefit from 40 per cent revenue share, and a return of 8 per cent as well as 50 per cent discount on bookings and F&B in all Rove Hotels and free two-week stay every year for life, based on terms and conditions. This marks a new investment value proposition in Dubai, as investors now can benefit from the city’s vibrant tourism sector."

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

New Rove Hotel to open at City Walk

The 564-key property will be located next to Dubai Arena

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