The huge increase in hotel rooms Qatar will need for the 2022 World Cup has raised the question of whether they can be filled once the event is over.
Qatar hotels may feel post-World Cup blues
Qatar's extensive hotel development plans in preparation for the World Cup 2022 are raising questions about whether the country will be left struggling to fill empty rooms after the event.
Qatar has about 100 properties that can serve as accommodation, totalling some 44,000 rooms, with plans to add 140 more properties, or an additional 55,000 rooms, according to FIFA's bid evaluation report. These include a cruise ship project in Al Wakrah, adding 6,000 rooms. Existing rooms include "villages and compounds". But information from the Qatar Tourism Authority shows there are only about 10,000 rooms in classified hotels. The consensus is that the event will generally be a boon for the country and its tourism industry. But there are concerns.
"I feel sorry for what will happen to Qatar after the World Cup," one hotelier in Doha said. "Who's going to come to Qatar?"
Hotel owners also lamented the fact that the tournament is likely to take place during the heat of summer, when soaring temperatures, at times exceeding 50°C, would deter some fans altogether. "What can people do during the day? You can't walk around [outside]," the hotelier pointed out. "That's a concern."
FIFA's evaluation of the bid also reflects issues over the timing of the tournament.
"Because of the reduced possibilities for excursions or for an accompanying programme of events etc, guests might prefer brief stays in the country, or might avoid long-distance flights to the host country altogether, thus resulting in less demand for the supply of rooms," the report said.
"The expected number of guests and the influx of visitors depends to a large extent on the timely construction of the new properties, on account of the fact that the accommodation is located in a small area in the immediate vicinity of the individual matches."
Qatar has slowed its planned hotel development amid the global economic downturn but the pace will now have to pick up to ensure it delivers the buildings in time for 2022. FIFA states that it has a requirement of 60,000 contracted rooms for a successful bid, so Qatar's projections far exceed that.
Analysts said to avoid "white elephant" properties, Qatar would have to find as many short-term solutions, such as temporary pre-fabricated accommodation and making use of existing inventory in the GCC.
"If they go for the full blast and build everything, they will have issues," said Jalil Mekouar, the head of Jones Lang LaSalle Hotels MENA. "But I don't think they will be building everything." He said other short-term solutions could include renting out residential properties.
Data from the Qatar Tourism Authority suggests occupancy levels are lower than hotels would prefer already, at an average of 61 per cent in the first half of this year.
Analysts say other parts of the GCC are likely to benefit from the World Cup, as many visitors may decide to stop off in places such as Dubai and Abu Dhabi.
"It will lead to a positive spillover for the rest of the region," said Marios Maratheftis at Standard Chartered.
He said whether the rooms could be filled after the event would depend on Qatar's diversification over the coming years.
"The World Cup is a catalyst that can reform the economy away from the oil and gas sector," he said. The use of temporary facilities such as cruise ships was a sensible solutionand would limit building, at least to some extent, said Mr Maratheftis.
Tourism is already a major part of Qatar's strategy to diversify its economy.
The country receives about 1 million visitors a year and expects growth of 20 per cent in tourism over the next five years, said the Qatar Tourism Authority.
Some US$17 billion (Dh62.44bn) had already been earmarked for tourism infrastructure development over the next five years, even before the successful bid, it said. These plans included the construction of luxury hotels, resorts and other leisure facilities, with a predicted 400 per cent increase in hotel capacity to 29,000 luxury rooms by 2012.