Leisure & Hospitality

UAE hotel revenue hits $7bn as guest numbers surge 15%

By Pramod Kumar, Gavin Gibbon

October 9, 2023, 5:02 AM

Minister of economy and head of the Emirates Tourism Council Abdullah bin Touq Al Marri leads the recent council meeting

Hotels received 16m guests
Occupancy rate hits 75%
Visitors to UAE spent $61bn

UAE hotels generated AED26 billion ($7.08 billion) in revenues in the first seven months of 2023, according to Abdullah bin Touq Al Marri, minister of economy.

Hotels received 16 million guests, up more than 15 percent annually in the year to July, the UAE state-owned Wam news agency reported, citing the minister, who also heads the Emirates Tourism Council, a body in charge of drafting the country’s tourism strategy.

Nearly 56 million hotel nights were booked as the occupancy rate hit 75 percent, increasing five percent year on year.

Taimur Khan, head of research at CBRE Middle East, revealed that revenue per available room (RevPar) was also up 4.1 percent.

“These are quite significant increases in that period,” he said.

The third edition of the “World’s Coolest Winter” initiative saw hotel revenues increase 20 percent to AED1.8 billion, compared to AED1.5 billion in its second edition.

Khan added that there had been strong growth in international source markets, particularly from Europe and the CIS countries. But the UAE also benefited from the reopening of China, thanks also to its status as a connectivity hub.

The number of domestic tourists reached 1.4 million, up eight percent year on year.

The United Nations World Tourism Organization said tourism in terms of traveller numbers had rebounded globally to 84 percent of levels before the pandemic, but Middle East arrivals exceeded pre-pandemic levels by 20 percent in the first seven months of 2023.

The total number of hotels in the Emirates reached 1,224. The growth will increase the contribution of the tourism sector to GDP to AED450 billion by the next decade.

Some 9,200 hotel rooms are to be added to Dubai’s inventory alone by the end of the year.

Khan dismissed concerns around potential over-supply, explaining that the addition of hotels in the mid-to-upper-scale market “has helped differentiate brands and create a more aligned global top-end market”.

“Like many other segments of the market, there is enough demand to look after the supply which is coming in,” he said.

Al Marri disclosed a hospitality advisory committee has been formed to stimulate growth and increase the tourism sector’s competitiveness.

He added that the committee will seek to improve the country’s attractiveness for tourism-related investments and create tourism initiatives and programmes.

The UAE is looking to double its GDP to more than $800 billion by 2030 and tourism accounts for around 15 percent of the total.

“We need to grow by 7 percent by 2030,” confirmed Al Marri, adding that the UAE’s tourism strategy focuses on attracting AED450 billion ($123 billion) of investments while raising tourism’s contribution to GDP.

In a message on social media on Saturday, Sheikh Mohammed bin Rashid Al Maktoum, vice-president and prime minister of the UAE, highlighted a recent report from the WTO, which ranked the UAE fourth globally for international spending.

Visitors spent AED224 billion ($61 billion) in the UAE last year, according to the WTO report, placing the country behind only the US, Spain and the UK.

Al Marri last month announced plans for a new visa to allow travel within the GCC countries, in a bid to boost local and regional tourism.

The GCC visa being considered will allow those residing in the bloc to travel easily among the six members states – the UAE, Saudi Arabia, Qatar, Bahrain, Kuwait and Oman.

“It will allow local tourism to focus not just on one country but on the whole GCC as well,” the minister said. “It is on the table, we’re going to see it very soon.”

Until now, only GCC citizens could easily cross the borders between the GCC countries, while non-citizen residents usually need to apply for a visa.

The Oman News Agency reported that GCC tourism ministers have agreed to submit their views on the proposed unified visa to the GCC Secretariat General by the end of the year.

Khan said that, while he did not expect a huge influx of tourists as a result of a GCC visa, he believed it would be of particular interest to the economy market.

“I think it will certainly be helpful there. It will reduce the costs there and reduces the effort. That will definitely be key,” he said.