Abu Dhabi's largest hotel is opening up a lounge and two restaurants on site after receiving an alcohol licence more than a year after first opening its doors.
The five-star Grand Millennium Al Wahda hotel, which is Abu Dhabi's biggest hotel by number of beds, with 844 rooms, left three of its outlets closed because of the absence of a licence. The management said it had not been awarded the licence by the authorities until last month, declining to give further information.
Last Sunday, the property opened up its Reflexions bar. It plans to open up its Porterhouse American bar and grill next month, followed by its Asian restaurant, Toshi, in March.
"Of course the market will open up much more for us," said Adam Harvey, the director of sales and marketing at the Grand Millennium. "I think we are now there with everything to offer everybody. But it's still too early to be really specific about things impacting in a certain way. We would still like to maintain our family feel in the hotel and obviously add to the clientele business, as well as meetings, events, [and] conference business."
Food and beverage revenue at Abu Dhabi's hotels grew by 6 per cent last year over the previous year to Dh1.6 billion (US$436.9 million), according to the Abu Dhabi Tourism Authority.
About 60 per cent of a UAE hotel's total revenue typically comes from rooms and 40 per cent from food and beverage, according to hoteliers, so the property would have missed out on a large share of potential income.
But hotels that are designed to be "dry" claim they can benefit by appealing to different markets.
"We have a lot of bookings from the Government, and I think in this case having no alcohol is definitely an asset and also for GCC guests in general," said Alain Kropf, the general manager of the five-star Khalidiya Palace Rahyaan by Rotana in Abu Dhabi, which was designed to be managed under the company's alcohol-free brand.
The 443-room hotel attracts a large number of tourists from Germany and Russia, with visitors from these countries accounting for the majority of its leisure guests. Tourism makes up between 35 and 40 per cent of its business.
"Everybody probably thought we would not have these tourists because we don't have alcohol," said Mr Kropf.
Alcohol was just one factor in choosing a hotel, but location, recreation facilities and service were often more valuable to customers when they were selecting somewhere to stay, he said. Also, many guests preferred a more "family-friendly" environment, Mr Kropf explained.
Being alcohol-free could sometimes affect the price of rooms, he said.
"There are certain segments you need to compete a little harder on the price because you don't have alcohol," Mr Kropf said.
In some cases, the hotel would win corporate business because it was dry. But some US companies would avoid such a property because they consider alcohol to play an important role in client entertainment, he said.
Another luxury Millennium hotel, the Millennium Plaza Hotel in Dubai, which opened earlier this month, is also alcohol-free by design.
"It's dry for two major reasons," said Muin Serhan, the general manager of the property. "The owner wishes to have a dry hotel and the financing bank to build the building wished also to have a dry hotel."
He said 80 per cent of total sales came from room revenues, while about 20 per cent came from food and beverages at the 413-room hotel. Occupancy levels in its first 20 days of operations averaged at 95 per cent, he said, with the majority of guests coming from Russia, Germany and the UK.