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Real estate companies are increasingly looking to build more three and four star hotels in Dubai these days. Dubai has had a boom in recent years trying to become the recreation center of the Middle East. A large number of tourists, in addition to its expat community, flock to the streets of Dubai every year. This has given a huge boost to Dubai hotels, especially those in the luxury segment. As a result, many five-star hotels can be seen popping up on the Dubai skyline, and many are advertised regularly. On the other hand, the real estate market has failed to meet the needs of low-end clientele. Therefore, real estate agents are increasingly looking to develop more affordable hotels and trying to gain a foothold in this emerging scenario.
There are several reasons why we are witnessing a sudden increase in three and four star hotels in Dubai. First, tourism is diversifying and looking to win the favor of low-end clientele around the world. Airlines offer discounted flights to stay alive in an overcrowded area. Tour operators are selling cheaper last minute vacations and hotel rooms to win over more buyers. The travel industry is rapidly gaining a global and competitive outlook. Dubai hotels could not ignore these emerging trends. There are several other major cities in the Middle East that could soon start giving Dubai a run for its money. Dubai has no alternative but to start reviewing its policies; hence the growing demand for less expensive hotels now.
There are a total of 90 three and four star hotels in Dubai in the current scenario. However, it is very insufficient in the context of a growing demand for affordable accommodation. However, the trend could transform very quickly, as more and more UAE-based construction houses come up with budget hotel plans. Dubai investment firm Istithmar plans to partner with London-based Easy Group and build 50 more budget hotels in the near future. These Dubai hotels would be launched and promoted under the Istithmar Hotels brand. The Dutch hotel chain, Golden Tulip Hospitality, also plans to soon partner on 10 new budget hotels. The firm already manages twelve hotels in this region and six more are scheduled to open by the end of 2009.
Hotels in Dubai have always reported heavy occupancy, especially during peak summer seasons. However, the new emerging trend is that of a greater number of travelers from the Gulf region. Until recently, travelers from the Gulf made up as much as 25% of Dubai’s hotel clientele, most of whom had their annual summer vacations. However, this has risen to 50% in recent months. Most hotels and hotel apartments report occupancies that can exceed 80 to 90 percent. So you could tell how exhausted Dubai hotels could be to continue as a business today, and how urgently they need real estate firms to provide them with more three- and four-star hotels.