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Dubai hotel boom keeps room rates low for event planners

The building boom in Dubai continues unabated and nothing will slow it down this side of Expo 2020 with another 30,000 rooms sheduled to open in the next year.

Despite this, occupancy levels have held up and the result has been to keep rates low with luxury properties looking a snip – a glance online shows the Fairmont Dubai quoting £128 and Shangri La Dubai £211 for October this year and these are individual rather than group rates.

World Expo 2020 will be held between 20 October 2020 and 10 April 2021 but the investment in new properties will continue after those dates. Average occupancy in 2018 was 76 per cent and is currently running at 86 per cent, despite the huge growth in room inventory.

Speaking at trade Show Imex in Frankfurt, Dubai Business Events director Steen Jakobsen said: “We now have 118,000 rooms and we think it will be 148,000 rooms by 2022 so the pipeline continues.

“When I came here six years ago there were only 75,000 rooms but occupancy levels were the same. I don’t think any other city in the world can say they have added 45,000 rooms in six years and still maintained occupancy levels.

“The rates are softening but the owners have confidence in the market. The low rates have made us much more competitive with hotel products diversifying with more three and four hotels and therefore we have a more attractive offer for the association market.”

Dubai’s focus on the international association sector continues and the soft room rates are proving attractive for congresses.

Jakobsen said: “We now have 60 international associations based in our Dubai Association Centre and we are moving them into new, larger premises in our building.” Pressed on the future of the association community they have attracted, Jakobsen said: “We would like to see hundreds of them in Dubai.

“That’s why we are staging the conference for associations in December themed on the societal impact of associations (business, knowledge and government). This is the second one at Dubai Trade Centre. There is a growing understanding of the role of associations in the UAE and how they can bring knowledge, training, development and certification to help drive public sector benefits while association managers are realising they have to have a global strategy if they want to stay relevant to their members.”