x Abu Dhabi, UAEFriday 19 January 2018

Hotel rates expected to rise

Room rates in Abu Dhabi are set to rise again by the end of the year, says the chief of Rotana.

Rotana, the hotel company based in Abu Dhabi, believes room rates in the UAE will begin to rise by the end of the year, as a result of instability elsewhere in the region.

The group, which operates more hotels in the Emirates than any other company, said its leisure rates were likely to increase from November, when the extreme heat of summer begins to tail off.

"This means that demand is there for the UAE," said Omer Kaddouri, the chief operating officer of Rotana. "I think the problems of the wider area are affecting the UAE tourism business in a positive way."

Mr Kaddouri said many tourists had avoided travel to destinations including Egypt and opted for Dubai and Abu Dhabi instead.

"When you're talking to operators, they're saying there is demand and we're saying we're looking at a 5 to 10 per cent increase for the 2011 and 2012 [November to November] leisure rates," he said. "Things are looking up."

Hotel performances across the UAE have declined because of an increase in supply coupled with the global slowdown in travel.

For Rotana, other parts of the region are giving cause for concern.

The company operates four hotels in the Red Sea area of Egypt, with three in Sharm el Sheikh and another in Hurghada.

"We're still struggling there with the occupancy," Mr Kaddouri said. "The Russian market has not lifted their ban yet. A lot of the business we were getting was predominantly Russian. The UK market is trickling into Sharm.

"The occupancies we're hoping will start looking a little bit healthier towards April, May.

"We're working very hard to get out there, to make promotions, talking to our partners to encourage them to come back to Sharm, but it's going to have to rebuild slowly but surely."

Mr Kaddouri said occupancy levels across the major Red Sea resorts were running at 15 to 20 per cent.

"We rely completely on tourism, so without the tourists flying in from all over the place then of course we suffer."