Has the UAE hotel sector recovered from the Covid-19 pandemic?
Has the UAE hospitality industry recovered from the pandemic?
The UAE continues to dominate the Middle East travel market with its offerings and bookings across all travel segments, and this will continue to experience aggressive growth as Expo 2020 opens in October. After the difficult times of the pandemic, the Expo is a welcome opportunity for those of us in the hospitality industry, and we are already seeing the benefits of this event in the economy at large. It is encouraging after so many months of hardship.
What impact will Expo 2020 have on the sector?
The Expo is a huge opportunity for us, and above all a welcome event after the difficult months of 2020. There is renewed optimism around the event, which in turn stimulates growth in the economy of the Arab Emirates United.
The hospitality industry is a small part of the Expo ecosystem, but the event fuels medium to long term growth within the industry. According to the latest forecast from hotel industry data provider STR, hotel occupancy rates in Dubai will increase 77% year-on-year in the fourth quarter, with revenue per available room increasing even more than 86%.
The supply of rooms is also expected to increase 3.6% year-on-year in the fourth quarter. The boom of the event will resonate across the UAE, with hotel occupancy rates set to increase in Abu Dhabi as well as Dubai. Across the sector, we are preparing for the Expo, launching services, reallocating facilities and catering to different tastes and palettes. At IHG Hotels, we create Expo 2020 passports for children and organize specialized equipment and food menus suitable for all nationalities.
Have customer expectations changed over the long term?
The Covid-19 pandemic marked the most difficult time in the history of the hospitality industry, with significant social and economic disruption, and also led to changes in consumer behavior.
Our customers always appreciate and cherish our tailored services and experiences, but at the same time we see a renewed emphasis on health, wellness as well as flexibility in cancellation terms.
Going forward, where do you see greater demand in the GCC – luxury or mid-range?
The Middle East, long regarded as a luxury travel destination, is uniquely positioned to benefit from a growing wave of recovery in the luxury travel and tourism sector, due to the rebound in passenger air traffic in 2021 and the strength of the current demand for home-style “stays”. The pandemic may have affected the travel and tourism industry around the world, but the sector is also one of the few with the potential to recover quickly. Millions of people around the world have set luxury travel as a short-term goal and with many countries in the Middle East opening up to tourists, it is emerging as one of the few safe luxury travel destinations. in the world.
That said, the market is diversifying as the region becomes known to a larger base of travelers and new source markets. This has resulted in a recovery in demand in various accommodation segments, including mid-range, high-end and luxury hotels. There is also the rise of other types of branded accommodation such as micro-hotels and design-oriented lifestyle hotels that provide guests with unique experiences.
How can operators ensure they stay competitive, especially with the rise of Airbnb and other such platforms?
There is room within the sector for traditional operators as well as alternative concepts like Airbnb and HomeAway, because our proposals are different. For example, with events like the Expo, there will be definite stress on business equipment and services, and that’s something we’ll be doubling over in the next few months. For large groups, such as national contingents, a hotel offers more flexibility and ease and a better network of providers for tours, meetings, and leisure experiences.
There will always be new players in the hospitality industry, and this is something we welcome because it allows us to constantly innovate. While technology has taken hospitality out of the hotel realm and introduced new players like Airbnb, it has also helped us streamline and adapt our services.
Finally, what are the future trends that will reshape the regional hotel landscape?
Technology will continue to have an impact on the way we travel and stay in hotels. For customers, the brand proposition is as much about the booking experience, marketing and app functionality, as it is about the destination and hotel features. For owners, our offering is as much about our ability to generate additional revenue through data and technology, as it is about our scale and expertise.
In response to the challenges of Covid-19, we have used our investment in cloud-based technology to accelerate the deployment of digital enhancements that support safe and secure customer experiences and reduce unnecessary contact. This includes the application of QR code menus in all of our F&B establishments, the global roll-out of mobile check-in / check-out and piloting other mobile enhancements such as in-room meal orders and real-time payment points. .