Organisers of the Abu Dhabi Grand Prix have told hotels not to exploit fans and warned that prices will be capped if officials deem rates to be exorbitant.
Hotels told to play fair with race fans
ABU DHABI // Organisers of next year's Abu Dhabi Grand Prix have told hotels not to exploit fans and warned that prices will be capped if officials deem room rates to be exorbitant. More than 50,000 spectators are expected in Abu Dhabi for the race on Nov 15. With the capital's hotel room capacity unlikely to exceed 17,000 by then, demand is bound to outstrip supply.
Many hotels are already fully booked and some are charging a premium for dates covering the event. Khaldoon al Mubarak, the chairman of Abu Dhabi Motorsport Management (ADMM), the race organisers, said it was important for the event's success that prices not spiral out of control. The Abu Dhabi Tourism Authority (ADTA) said it was ready to intervene and cap prices if they were judged to be unreasonable.
The authority has already announced that it will cap hotel prices during next month's Abu Dhabi International Petroleum Exhibition and Conference (Adipec). Rates were set at Dh1,650 (US$450) a night for a five-star room; Dh1,200 for four-star room; and Dh800 for three-star room. Any hotel ignoring the limits faces a Dh200,000 fine for each night it is breached, and guests who booked rooms at higher rates will receive refunds.
The authority was granted the power to intervene by the Executive Council a month ago. Mubarak al Muhairi, ADTA's director general, said it had acted because it feared unreasonable prices "could have led to a withdrawal of some event organisers from Abu Dhabi". Mr Mubarak said ADMM's first priority was to make the race weekend a success, as both a sporting spectacle and commercial venture. "If these conflict then there is a balance that has to be struck.
"I don't think we will be in a situation here in Abu Dhabi where we will allow, whether it is hotels or restaurants, to go out of control. "That's not what we are about, what Abu Dhabi is about. We will be very careful to monitor that situation, to ensure things remain under control and people can afford to come here and have a good time." Many hotels rates for the Grand Prix weekend are already well above those set by ADTA for the Adipec conference.
On the day the race date was confirmed, the InterContinental hotel quoted Dh5,162 for a four-night stay in its cheapest room over that weekend, including Dh1,856 after tax for the first night and Dh1,102 per night thereafter. By the next day, the rate for the same period had risen to Dh11,600. By last weekend, it was Dh12,644, an increase of 145 per cent. Rooms would now cost Dh3,944 for the first night and Dh2,900 for each night thereafter, staff said.
Prices for race weekend at Le Meridien have increased by 27 per cent since June - Dh12,992 for the four-night stay, compared with Dh10,208 four months ago. The Emirates Palace, Crowne Plaza and Royal Meridien hotels all quoted the same prices this week as before the race date was confirmed - Dh15,780, Dh10,208 and Dh12,528, respectively, for four nights, inclusive of taxes. However, at least one hotel insisted that its increased rates for the Grand Prix weekend had been approved by ADTA.
And hoteliers generally mounted a robust defence of the principle of premium rates during attractive events. "Let's just put things into perspective," said Reema Baroudi, a spokeswoman for the InterContinental. "When you go to attend the Grand Prix in Monaco, the rate per night in Monaco is 900 euros (Dh4,200) per room per night, not inclusive of anything, and overlooking the rubbish bins probably, in a substandard room.
"Or take the Formula One races in Bahrain. I believe the rate per night was Dh3,000 per night and you have to book for a minimum of four nights, not just one." James Trabutt, the general manager at Le Meridien, said hoteliers were unhappy with the decision to cap rates for Adipec. Rates at the hotel were to be held at Dh1,650 for a standard room, he said, about 20 per cent less than what the hotel hoped to be able to earn per room. "We were not prepared for this," he said, noting that hotels expect to earn more money in busy seasons to balance the lack of guests during summer and Ramadan.
An ADTA spokeswoman said the authority hoped hotels would regulate their own prices fairly during the Grand Prix weekend, but was prepared to intervene if necessary. With 50,000 spectators, around 2,000 team staff and 600 journalists expected to attend, rooms will be in short supply. ADTA said it expected there to be 16,662 hotel rooms in the capital by race weekend, compared with 14,185 at present.
A new 500-room, five-star hotel at Yas Marina and a new Crowne Plaza hotel on Reem Island are scheduled to be open by Nov 2009. A spokesman for the Emirates Palace hotel said its 392 rooms had been sold out for the weekend "for quite some time". "It is Formula One weekend and we are one of the main race cities. It is going to be very, very popular." The city centre Crowne Plaza, which has 236 rooms, is also fully booked, and both Al Raha Beach and InterContinental hotels reported only a handful of rooms left.
Dubai is also set to profit from the race with many hotels - especially at Jumeirah or at the Marina - less than an hour away by road in ordinary conditions. It is not unusual for motor racing fans to avoid expensive hotel rates by staying in cities away from the venue. But fans are being warned to book early because two other major events take place immediately after the race. The Dubai Airshow is to be staged from Nov 16 to 18, and the Race to Dubai golf competition from Nov 19 to 22. "One of our hotels, the Courtyard in Jebel Ali, is getting battered by enquiries," said Jeff Strachan, area director for the Marriott chain.
@Email:email@example.com * Additional reporting by Jen Gerson