• How would you gauge the state of the Dubai serviced apartment market and what are Nakheel’s plans for this sector over the next few years?
“Dubai’s tourism targets – under which the emirate will attract 25 million visitors a year by 2025 – are leading to continuous expansion in the hospitality sector, including the serviced apartment market. Nakheel’s specific interest in this field is in the branded hotel apartments sector. We already have a partnership with AccorHotels, with 331 luxury Raffles branded residences at our upcoming PALM360 development on Dubai’s Palm Jumeirah, with discussions under way for more collaborations with world-leading hotel brands for more hotel apartments.”
• How do you decide which hotel operators to work with on your hotel and serviced apartment developments?
“We work with reputable, international hospitality brands – some of which we are bringing to Dubai for the first time – for our growing collection of hotels and hotel apartment complexes. We currently have more than 6,000 hotel rooms and hotel apartments in our existing and upcoming hospitality project portfolio, with management agreements with the likes of AccorHotels (for Raffles and ibis brands), Marriott (for St Regis) and Whitbread (for Premier Inn), with more in the pipeline.”
“In addition, we have resorts under construction through joint ventures with Spain’s RIU Hotels & Resorts and Thailand’s Centara Hotels & Resorts, both of which offer four star, family-orientated beachfront accommodation – a concept that has never before been seen in Dubai.”
• Is the mixed-use hotel and apartments model now becoming the norm rather the exception in Dubai?
“The serviced apartment/branded residences market has grown lately in Dubai. We ourselves have mixed-use hotel and residential projects in our hospitality portfolio. Hotel-branded residences can attract investors globally. For some investors, buying a branded residence can be the first step on the foreign property ownership ladder: they may have been loyal to a particular hotel brand for many years and buying a brand they are familiar with gives them the confidence they need to invest.”
“In addition, for those who regularly travel here on business or vacation and normally stay in hotels, it can make sense to invest in a place of their own. Many choose to do this with a branded home.”
• Do you think boutique and lifestyle hotel brands are becoming more popular in Dubai? If so why?
“Dubai’s hospitality offering is diversifying all the time, and boutique and lifestyle brands are undoubtedly on the increase. Dubai is aiming to attract 25 million tourists a year by 2025, and is working to achieve this by offering alternative accommodation to the large, five star, luxury resorts that the city has traditionally been associated with.”
• How do you imagine the Dubai hospitality development scene will evolve and change in the post-2020 era?
“We will continue to see diversification of hospitality offerings as Dubai works to achieve its tourism targets and further consolidate its position as one of the world’s most visited destinations. The current emphasis is on creating more mid-scale, family-focussed accommodation: the biggest expansion in hotel rooms in 2017 was in the four star category, with a 10 per cent increase to over 25,000 rooms. Nakheel alone has around 3,000 rooms – in operation or under construction – in this category.”
• Which areas of Dubai are earmarked for significant hospitality developments in the future?
“Nakheel’s Deira Islands development, where we have so far invested nearly AED9 billion in infrastructure and construction contracts, is pivotal to Dubai’s growing tourism market. The four-island project is adding 40km of coastline, including 21 km of beach, to Dubai, and is paving the way for new hotels, residences and retail and entertainment attractions. We have sold 40 hotel plots at Deira Islands and are currently constructing two beachfront resorts, through our joint ventures with RIU and Centara, there.”
“Other key areas for more hospitality developments include Palm Jumeirah, which is already a world-famous, award-winning destination and home to The Palm Tower and PALM360, two new luxury Nakheel developments that will be home to the St Regis and Raffles brands respectively. The trend of building hotels next to shopping malls also continues: we have two in operation and several more under development in both established and upcoming areas.”
