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Dubai: Affordable luxury?
Hotels in Dubai are trying to lure guests with discounted rates. Will it work?
January 19, 2009 4:08 by Dana El Baltaji
This time last year, hotels were bragging about their occupancy rates. Getting a hotel room was tough, and expensive. By the time August 2008 came around, ‘Dubai’s rates were the highest in the world,” said Anwar Abu Monassar, general manager of Net Group, a Dubai-based tour operator, in an interview with AME Info. “In just ten years hotel rates went from $50 a night to $1,500 per night. You can call it what you want – snobbery, crazy, very good, it depends on your point of view at the end of the day.”
Today, however, hotels are struggling to attract guests. Some hotels, like the Hilton hotels, are dropping their room rates by as much as 50 percent, although that might not be enough to encourage credit crunched vacationers to stay in luxury hotels.
As part of Dubai’s Department of Tourism and Commerce Marketing (DTCM), hotels are being encouraged to reduce their room rates by as much as 60 percent and their food and beverage prices by 25 percent. Furthermore, the DTCM has launched an international marketing campaign to attract tourists from Britain, Germany, India, China, Japan, Australia and the GCC.
Given the global recession, however, would discounted prices lure tourists to Dubai’s luxury hotels at a time when most people are hoarding their cash?
As for the sector’s future, Monassar does not think that it will ever be as strong as it was in 2008: “Hotels will not enjoy the same situation they had before, where they had high rates and they could sell whatever they wanted. In the future there will be more balance. Definitely not undersupply and not oversupply.”
Does this mean that Dubai will offer tourists “affordable” luxury like it used to?