Construction industry to play a major role in driving growth for hospitality sector
With another 30,000 new rooms set to create a supply glut in Dubai and large pipelines in Abu Dhabi, Muscat and Saudi Arabia, hotel owners who embrace change and take advantage of opportunities specific to the market conditions will be the best equipped to deliver long-term growth, says Simon Allison, CEO of hotel owners’ alliance, HOFTEL, and organiser of GIOHIS.
Potential approaches, which can avoid a “race to the bottom” on prices, will be among the key talking points at the Gulf and Indian Ocean Hotel Investors’ Summit 2019 (GIOHIS) in Abu Dhabi on 4-5 February.
Where affordable, for example, Allison argues that a slow market can be the ideal time for hoteliers to invest in renovating their properties.
He says: “Finding the ideal time for renovation work is always tricky, but coinciding it with a slower market means that hoteliers will be displacing less paying business, with the potential added bonus that contractors’ prices will have fallen if the glut of property really bites. At the same time, from the contractors’ perspective, the ongoing hospitality building boom in preparation for Expo 2020 provides much-needed relief from the slowdown in residential demand.”
He adds: “There is a big temptation during a period of oversupply for hoteliers to focus on price reductions alone to attract customers, but a multi-faceted approach is much more likely to benefit their long-term success.”