Depa sees big opportunities in economic gloom

GLOOM AND BOOM: Depa chief Mohanned Sweid, left, says the economic downturn has had a positive impact on his business. (Supplied)

The head of Dubai-based interior contractor Depa said on Tuesday that he expects the economic downturn to boost hospitality refurbishments in the region.

“I don’t see a drop in the number of inquiries, in fact is it the other way round,” chief executive Mohannad Sweid told Arabian Business.

Sweid said during economic lows, hotels typically take advantage of low occupancy rates to refurbish using funds already available.

“During downturns lots of hotels take the opportunity of a low occupancy to close down floors. [The] funds are available because they have [already been] deducted from revenue and put into a special account to fund refurbishment, so they don’t have to go to banks for funds.”

“This started in London with the four Seasons and the Ritz and we have started seeing it from hotels in this region,” he said.

Sweid also said cash-rich developers would also be seizing opportunities to fast track hospitality projects. “Cash rich developers will be utilizing their cash in the coming two years to really make use this crisis to their advantage.”

Occupancy rates for hotels in Dubai fell by four percent in 2008 to October as a result of the global economic downturn, according to figures.

The number of people checking into hotels in Kuwait City and Manama also fell by 5.5 and 2.2 percent respectively compared to the same period in 2007, according figures released by STR Global.

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