Juma Al Majid Group, a Dubai-based conglomerate, has taken over operations of Taj Palace Hotel in Deira from India’s Taj Hotels Resorts and Palaces.
Juma Al Majid Group, which owns the property, will operate it under its hospitality division. Opened in 2001 as the Taj Palace Hotel, it is now branded as Jood Palace Hotel. The property is taking bookings under the new name.
Taj Hotels did not give a reason for the exit but said it was through “a mutual agreement reached between the erstwhile partners”.
The 147-room, five-star hotel was Taj Hotel's first and only property in the UAE until March, when the Tata Group opened the 296-room five-star Taj Dubai in Business Bay. Juma Al Majid Group, which has interests in real estate, travel and contracting, did not immediately respond to requests for comment.
“Now that hotels are coming of age in the region, we are starting to see a few instances where owners and operators part company after a long period of time and this is usually related to an expectation gap, which means that either the owner is no longer investing sufficiently in the property to maintain brand standards and the operator is being offered far better opportunities nearby, or the owner is looking to reposition the property and feels that the operator is no longer suitable for the owner’s strategic objectives,” said John Podaras, a Dubai-based partner at the hospitality consultancy Hotel Development Resources.
Among recent exits and rebrandings are Danat Al Ain Resort’s replacing the InterContinental in 2011, and InterContinental Hotels Group replacing Marriott’s Renaissance brand in Deira the same year.
Indian hotel companies such as Taj and Oberoi have met with mixed success in Dubai, with some earlier-announced projects yet to open. These include Taj’s Palm Jumeirah development and Oberoi’s projects in Yas Island and Al Raha Beach.
Oberoi opened in Dubai’s Business Bay in 2013 and plans to open in Ajman this year.
The Tata Group has recently pulled out of some of its overseas properties. In September last year, it pulled out of Taj Palace Marrakech in Morocco, which is owned by Morocco-based JK Hotels. In July last year, it announced the sale of Blue Sydney, a Taj Hotel, to the Hong Kong-based Hind Hotels and Properties Group for A$32 million.
“The divestment has been undertaken as part of the Taj Group’s strategy to focus on markets which are core to the group’s operations, and to create liquidity to fund the company’s ongoing expansion in such markets,” Taj Group said during the Blue Sydney announcement last year. “Asia Pacifc and particularly China have been identified as targets for expansion.”
Taj Hotels Resorts and Palaces owns and operates 96 hotels worldwide.
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