Atlantis leading hotel rebound in Dubai

Dubai's Atlantis The Palm says its room rates have increased by 10 per cent on last year as beach resorts lead a recovery in the industry.

"Since the beginning of the year, we've seen a real strong bounce-back in Dubai," said Brett Armitage, the senior vice president of sales at the 1,539-room resort, Dubai's largest hotel.

"We're definitely seeing an uplift in rates in comparison to where we were last year."

He said the property had this year managed to increase rates by 10 per cent compared with this time last year.

"One of the main things that Dubai benefits from is that we aren't reliant on one single market," Mr Armitage said.

The hotel this month has been enjoying occupancy levels above 90 per cent, and was already "virtually full" for the Easter weekend, with half of those guests coming from Europe.

City hotels in Dubai have experienced a strong flow of business, helped by an influx of Saudi visitors last week during a holiday in the kingdom. The arrival of Saudi tourists helped some hotels to fill all their rooms last week.

But there is also stiff competition from properties opened in the past year, and city-centre hotels do not benefit as much from demand among European tourists, who generally favour the beach resorts.

"The rest of April and May is looking a little bit slow," said Afeef Naqvi, the executive assistant manager at the Ramada Downtown hotel in Dubai, adding that business was still better than last year. "All of us are looking to start the summer early. Before we were looking at starting from 16th May onwards, but now we're looking at the option of starting [summer promotions] from the 1st May."

In a report this month, the property consultancy Jones Lang LaSalle gave a mixed forecast for the hotel sector.

"Performance of established beach hotels [is] expected to stabilise in 2011, with further downward pressure on average daily rates and revenue per available room for newly opened city hotels," the report said.

Mr Naqvi said a strong flow of tourists from the GCC into Dubai was likely to continue over the summer as travellers avoided less-stable parts of the region.

"After the summer we'll see how the neighbouring places open up. But there's no sign of it right now, so I think the trend will continue to the next year, the way things are going," he said.

In February, occupancy at Dubai hotels was an average 86.8 per cent, up 1.3 per cent on the same month last year, despite an increase in the number of hotel rooms in the market. Average room rates were up 0.7 per cent to Dh912 (US$248.29), and revenue per available room was up 2 per cent to Dh792.

Syed Zulfiqar Mehdi, the director of sales and marketing at the Samaya Hotel in Dubai, agreed that the trend was likely to continue. "I'm very positive that this summer will be better than last year," he said.

Meanwhile, Rotana Hotels, based in the capital, has managed to attract conferences and meetings away from Bahrain and into Dubai and Abu Dhabi by sending sales representatives to the kingdom to pick up business as companies look for alternative destinations because of the instability there.

"We're hoping to get more," said Adrian Deegan, Rotana's director of sales and marketing for Abu Dhabi and Al Ain.

rbundhun@thenational.ae