Live from AHIC, Dubai: 525 tourism leaders from around the world have gathered in the Madinat Jumeirah, Dubai today to discuss investment opportunities in the region and the growth of tourism at the first ever Arabian Hotel Investment Conference.
During his welcoming speech, Jonathon Worsley, Conference Chair & Organiser Arabian Hotel Investment Conference Consultant, CB Richard Ellis Hotels , revealed that the objective of the AHIC was to create a forum in the Middle East for people to meet.
He then outlined feedback given by over 200 delegates in the questionnaire survey which looked at critical investment areas to be discussed over the next 2 days.
Highlights of the survey results:
43% of those surveyed said that any investment into the Middle Eastern region in the next 3 - 5 years would be in the UAE. 18% said Qatar would be a future investment area and 9% chose Oman
Hotel brands expected to be the market leader in the Middle East in 5 years include: Intercontinental Hotels Group, Starwood Hotels, Marriott International, Accor and Hilton International
Le Meridien Hotels and Resorts were tipped as the working hotel brand that will have the best working relationship with local owners in Dubai, followed by Jumeirah International, Marriott Group, InterContinental Hotels Group and Starwood Hotels and Resorts.
According to participants, factors that need to change to encourage foreign direct investment into real estate in the Middle East region are: Market transparency, Land Tenure, Higher Returns
Three challenges facing invest in securing hotel financing for new build projects include:Economic factors such as rising construction and land costs, tenure, transparency, dollar value and equity participation. Feasibility taking into consideration location, sourcing operator with local knowledge, supply risk, unrealistic feasibility studies and Country / Geopolotical circumastances such as security and Government regulations.
When will 36% of participants predict that hotel operators be prepared to share operational risk in management agreements in the Middle Ease with guarantees, key, money or loans in 2 - 5 years. 21% thought this would take more that 5 years, while 23% said this would never happen.
New tourists are expected to come from Europe, China and the Middle East.
According to 83% of those surveyed, the internet is providing 89% of incremental revenue to the hotel industry. While 9 out of 10 people agreed that the internet does provide incremental revenue, only 563% thought that the internet is discounting business that would come anyway.
According to the survey, the most troubling trends relative to the hotel development in the Middle East include: Staffing issues, focus on upscale, over supply, mass tourism, environment, few local brands, perceived geo political instability and stability in the region.