The hospitality business in the Gulf Cooperation Council (GCC) nations estimate to improve from $22.8 billion (Dh83.7 billion) in 2013 to $35.9 billion by 2018, at a yearly rate of 9.5%, according to a recent report.
The UAE’s hospitality business is approximated to improve at a compound yearly progress rate of 10% between 2013 and 2018.
The expansion of the business in the locality will be increased by the shift in worldwide activity from the West to the East, an increase in leisure travel, elevated demand for serviced apartments, a shift to budget travel and a faster construction pipeline.
The area’s development is also anticipated to be driven by worldwide tourist influxes, particularly those from Asia, and a more robust MICE [meetings, incentives, conferences and exhibitions] section, among others.
The GCC has generated main investments in developing airports there. For example, in Dubai, a Dh117.5 billion expansion of Al Maktoum International at Dubai World Central is expected to begin by the end of the year. The airport will be competent to cater 120 million travelers within six to eight years.
Nevertheless, as GCC nations improve their hotel room competence in the run up to key occasions there, they face the challenge of continuing demand after those events take place. The region has made major investments in infrastructure for events, such as the World Expo 2020 in Dubai. The six-month long trade exhibition will be the key driver of the hospitality business in the UAE, which has a leisure travel market valued at $23 billion, according to the report.
In Dubai, hotel room supply and demand could be balanced after Expo 2020.
Common hotel occupancy rates in the GCC are estimated to be 68% and 74% between 2013 and 2018, whereas common daily rate is possible to be between $225 and $263 during the similar period of time.
Other hindrances faced by the GCC as well as contending with newer projects and interesting skilled labour to the region.