What goes up must come down - except for hotel prices in Abu Dhabi. According to a global survey by Hogg Robinson Group (HRG), the UK-based corporate travel services organisation, hotel rooms in Moscow were the most expensive in the world, followed by those in Abu Dhabi, for the second straight year. But in many of the most pricey cities, including London, New York, and Moscow, room rates fell in 2009. Not in Abu Dhabi, where an average nightly stay put you back $405 (Dh1,486) last year, $58 more than in 2008.
Douglas Williams, the chief executive of the Centre for Economics and Business Research Ltd, viewed the survey as evidence that the "recovery remains at a relatively early stage". But the numbers in Abu Dhabi and in some other Gulf markets, including Manama, where prices also saw a substantial increase, show that the recovery in some places is robust. That room rates rose by nearly 17 per cent in Abu Dhabi during the biggest global slump in decades - and in a year where dozens of new hotels came on line - makes the development all the more remarkable. These events should have moderated prices in Abu Dhabi but HRG's survey suggests that they were counteracted by more powerful influences. The emirate's busy convention schedule and addition of what will become annual events, such as the Formula One Grand Prix, kept occupancy rates high. The opening of the Guggenheim, Louvre, and NYU-Abu Dhabi on Saadiyat Island in the next decade will also place upwards pressure on prices and should necessitate the construction of more hotels, many of which are already in the works.
Part of Abu Dhabi's strategy for development rests on the pursuit of upmarket tourism. HRG's survey is evidence of its success. Still, Abu Dhabi must maintain a delicate balance. It should be careful not to price out too many tourists, even as it attempts to keep prices steady. It must have enough rooms available as many of its most exciting projects come online, while staying vigilant against oversupply. This balancing act will be a challenge. But as the HRG report shows, Abu Dhabi is in an enviable position.