Development of Fujairah's prime tourism area has stalled, with no major resorts opening in Al Aqah beach area in the past three years despite plans to launch a number of luxury properties. Hotels including Angsana, Fairmont and Radisson were due to be completed last year. None of the planned hotels is now expected to open before next year. But the existing resorts in the area say the delays could be a blessing in disguise, as they are offering deep discounts to attract tourists and there is increased competition from new resorts in other emirates.
"We are happier with not having to put up with new competition right now," said Patrick Antaki, the general manager of Le Meridien Al Aqah Beach Resort in Fujairah. "The state of the market is very slow, so it might not be the right time to speed up a building and open it up." Room rates have fallen by up to 40 per cent from their peaks of 2007 and early 2008, hoteliers say. Last year, 436,638 visitors stayed in the eastern emirate, according to official government statistics.
While there are no more recent official figures yet, some hoteliers say the number of visitors has slowed slightly at a time of economic uncertainty and other resorts opening in the Emirates. The Hotel JAL Fujairah Resort and Spa depends on guests from within the UAE to provide about half its business, which boosts its popularity at weekends. But new properties, such as the Qasr Al Sarab desert resort in Abu Dhabi and the Hilton and Banyan Tree resorts in Ras al Khaimah, are luring away some of Fujairah's visitors.
"There is much more competition," said Christian Rainalter, the general manager of the Hotel JAL Fujairah. "We see very much Ras al Khaimah as direct competition and Dubai as well, because it still remains the prime choice for most travellers." But if the other luxury hotels had opened they may have created additional publicity for Fujairah, Mr Rainalter said. "If there were more hotels it would have a bigger impact on the worldwide market, therefore making the destination Fujairah better known to the outside world," he said.
"At the same time, at this stage it's easier for us to fill up the rooms. If this would now be double, would there now be enough demand to absorb the extra inventory?" The Fairmont resort, being developed by Mina Al Fajer, is expected to open next year, a spokeswoman for the hotel management company said. "The economic climate over the past few years affected the pace of many of the projects for which we have management agreements, but the Fairmont Mina Al Fajer is indeed progressing," the spokeswoman said.
Executives from Banyan Tree, however, said in April it no longer had a hotel project in Fujairah. The luxury hotel company based in Singapore said in a statement in 2006 that it had signed an agreement with Damas Hotels to operate the 117-room Angsana Resort and Spa, which was due for completion last year. A progress report issued early last year on the Singapore stock exchange for the last quarter of 2008 said the project had "stalled due to owner financing".