Hotel prices in the UAE have seen a significant spike ahead of the busy holiday period.
Burj Khalifa-facing hotels in Downtown Dubai are some of the priciest as New Year's Eve approaches.
The Address Dubai Mall Hotel, for example, costs Dh11,200 for a minimum two night stay from December 30 to January 1. That is the price for a 45 square-metre room, without breakfast, that overlooks Burj Khalifa.
A week later, the rates for the room drop down again to Dh1,469 per night.
Burj Khalifa will host a massive fireworks and laser show display when the clock strikes midnight. Registration is limited due to Covid-19 but the show will also be live-streamed online for those who can't watch it in person.
In Abu Dhabi, a room at the W Abu Dhabi hotel in Yas Marina, overlooking one of the capital's fireworks displays, costs Dh880 on December 31. Prices dip to Dh540 per night a week later.
Over in Fujairah, the Intercontinental Fujairah Resort has rates of Dh2,935 on Booking.com for Thursday night. Prices drop to Dh855 a week later.
Tareq Aboudib, general manager of the Sandy Beach Hotel and Resort in Fujairah, said the time between Christmas and New Year is typically the busiest season for hotels and this year is no different.
"On New Year’s we are fully booked,” he said. “This is a time where people tend to come together with different friends and family members and celebrate in a more outgoing fashion.”
A standard room at the resort for New Year's Eve starts at Dh878 and a two-bedroom apartment is Dh2,008.
A week later, a standard room is listed for Dh462 on Booking.com and the two-bedroom is going for Dh1,100.
Mr Aboudib said staycations were, unsurprisingly, in-demand this year because of limitations on travel. He said staycations helped hotels stay afloat as international tourism took a global hit.
“People want to get away, even if it’s within the Emirates,” he said.
Sonia Ngninkeu, co-owner of Bethel Vacation Homes in Dubai, said Airbnb was also popular during this time, as residents and tourist look for more affordable options.
She said December was the hospitality sector's peak season.
“A lot of hotels and vacation home owners are going for 30 to 50 per cent increase in prices for New Year’s Eve. We did a 30 per cent increase,” said Ms Ngninkeu.
Her company manages six holiday homes that they rent out on Airbnb.
“It’s a very busy period for us,” she said. “Some people prefer to stay in hotels, while others want to stay in Airbnbs, as it is still a more affordable option.”
Burj Khalifa-facing apartments on Airbnb cost between Dh1,900 to Dh2,900 on New Year's Eve.
Dubai's tourism spots - in pictures
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.”
MATCH INFO
Uefa Champions League semi-final, first leg
Tottenham 0-1 Ajax, Tuesday
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Ajax v Tottenham, Wednesday, May 8, 11pm
Game is on BeIN Sports
Recent winners
2002 Giselle Khoury (Colombia)
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Russia's Muslim Heartlands
Dominic Rubin, Oxford
Brief scores:
Arsenal 4
Xhaka 25', Lacazette 55', Ramsey 79', Aubameyang 83'
Fulham 1
Kamara 69'
