The size and scale of the Palm Atlantis development has forced the German hotelier Kempinski to delay opening its planned five-star hotel on the Palm Jumeirah by two years. While the company will open its Kempinski Residences serviced apartments next March, its 240-room Emerald Palace hotel will not open until 18 months later because of concern about demand. "We saw the monstrosity of the Atlantis grow and grow and grow," Ulrich Eckhardt, the Middle East and Africa president of Kempinski, said yesterday. "We felt to open in the wake of the Atlantis would have been the wrong this to do. We would have been eaten up."
Kempinski was unaware that the Atlantis would have 1,539 rooms, six times the proposed size of the Emerald Palace and more than seven times the initially proposed capacity threshold for the development, he said. "When the Palm was conceived it was supposed to be very low density, with hotels that had a maximum of about 200 rooms," he said. Dubai hotels have attracted attention since Dubai World's announcement last month it was seeking a standstill on billions of dollars in debt. UK searches for lodgings in the emirate have risen by 570 per cent over that span, the internet site hotels.com said, as travellers searched for perceived bargains in a warm-weather climate.
The average price of a five-star hotel room in Dubai was £174 (Dh1,040) per night in the first half of this year, the travel site said. However, a similar room would cost on average £144 a night next month, a 17 per cent drop, amid a downturn in travel demand and increased room supply. A five-star weekend break in mid-January started from £74 per night, hotels.com said. Although thousands of rooms are scheduled to open in Dubai next year, Mr Eckhardt said a number of them might not come to fruition.
"I think there is a marked slowdown in Dubai in hotel construction and hotel openings," he said. Banks were less inclined to lend money to the hospitality market in the current economic climate, he said. Kempinski also manages the Emirates Palace hotel in Abu Dhabi, which Mr Eckhardt said must introduce more flexible pricing packages during the quieter summer months to avoid losing money. @Email:email@example.com