Laying down Sharia Law

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Radisson Blu Residence, Dubai Marina.

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V. Five Continents CEO Richard Abou Jaoude.

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Radisson Blu Residence, Dubai Marina, general manager Cornelia Erhardt.

Consumer demand for sharia-compliant hotels is strong, but confusion surrounding the term means many brands are reluctant to commit. Louise Birchall seeks to clarify what it takes to comply.

Two-to-three years ago ‘sharia' was the buzz word repeated by ambitious, international hotel chains intent on tapping into the rich, intraregional Arab tourism market by offering a unique and traditional Arabic experience.

Eager to differentiate themselves, hotel brands witnessed the success of sharia-compliant banking and investment systems compared to conventional institutions and saw an opportunity to apply the concept to hospitality.

This trend, coupled with an increasing amount of government funding and private money being injected into sharia-compliant developments stirred the interest of hotel investors.

However, today only a handful of the talked-about sharia hotel developments have materialised and experts attribute a lack of progress on the hotel front to the confusion surrounding the term ‘sharia'.

Dubai-based Almulla Hospitality recently unveiled plans for a sharia-compliant brand comprising 30 hotels, but there has been no news of its development and similarly Dubai-based Shaza Hotels' alcohol-free luxury hotel joint venture with Kempinski Hotels and Guidance Financial Group has yet to open the first of its 30 hotels scheduled to launch in the Middle East over the next 10 years.

Defining sharia

"The terminology ‘sharia compliant' is mixed up in the sense a lot of people confuse the term and their practices. For a hotel to be fully sharia compliant, it would need a team of religious advisors on board and it really has to go the whole way," says V. Five Continents Hospitality Group CEO and founder Richard Abou Jaoude.

The Abu Dhabi-based hotel operator's portfolio of sharia-compliant properties has grown from two to 14 in the Middle East and North Africa since the company entered the market in 2006.

"It was boom time and we realised we were competing with the top guns of the industry and the first thing that came to mind was how to be different, what is missing in the regional hotel market and how can we make a quick return on investment," says Jaoude.

At that time few companies had approached the sharia niche and V. Five Continents hoped it could differentiate itself with a three- to four-star plus brand. It also had the backing of international brands such as Ramada and timeshare in companies such as Kerzner.

Finding a niche

According to Jaoude, the brand concept proposed by V. Five Continents was to be an "entirely new one". The concept encompasses the major parts of sharia, including no alcohol, and other aspects such as no smoking, ‘green' measures in the building and landscaping, and the promotion of wellness.

The company has partnered with various international spa consultants, health academies and environmentalists to offer a well-rounded, healthy-lifestyle concept, which incorporates the basic principles of sharia law almost by coincidence. As a result, Jaoude says he does not consider the hotel fully compliant, but rather, "sensitive to the hotel surrounds".

"Other operators, like Rotana, are looking to diversify into the sharia market with their new sharia-compliant brand, but we only specialise in sharia and wellness properties," adds Jaoude.

Rayhaan Hotels & Resorts by Rotana encompasses the norms of traditional Arabic hospitality. Its first property, The Al Marwa Rayhaan, opened last month in Makkah, Saudi Arabia and Rotana executive VP and COO Imad Elias also claims it is in an "entirely new concept, both in the region and on the market".

The hotel group based the development of Rayhaan Hotels & Resorts on "research indicating this category of sharia hotels has huge potential due to its inherent appeal in the region", says Elias, who adds "Rayhaan is set for incredible growth in upcoming years".

Most recently, SHUAA Capital Saudi Arabia (SCSA), the Saudi Arabian subsidiary of SHUAA Capital, announced the signing of a master agreement with Rotana to develop 17 four- and five-star sharia-compliant hotels and resorts and hotel apartments, comprising 5500 rooms across Saudi Arabia.

In the UAE, the Khalidiya Palace Rayhaan, Abu Dhabi is due to open in the last quarter of 2009 and will "complement the values of the contemporary Arabian culture, in an alcohol-free environment".

"The acceptance of the brand from customers has been excellent. On our regular sales trips throughout the GCC countries, we have received encouraging and supporting feedback for Rayhaan. As for the owners; investors in the GCC have seen a niche, which was not covered by any brand and Rayhaan fits perfectly into it," says Elias.

"Nowadays the competition is so ferocious that you end up competing with everyone. Our key to success is based on the fact that Rayhaan is endorsed by Rotana; a guarantee for the customer and we have defined our service to be unique," he adds.

"We must emphasise that Rayhaan Hotels & Resorts is not fully sharia compliant, but it is an alcohol-free brand. We have a large Arab national customer base and are careful and sensitive towards clients' needs and traditions," explains Elias.

Guidance needed

Despite being known for their sharia concepts, neither V. Five Continents nor Rotana profess to be fully sharia compliant. Instead, elements of sharia law are used to develop a brand.

For example, V. Five Continents intends to define itself by incorporating ‘green', wellness and sharia aspects in its hotels.  "We want to prove wellness doesn't necessarily mean a hospital or spa. It depicts a wider environment," says Jaoude.

Other hotels, such as Tamani Hotel Marina, Dubai follow the basic fundamentals of sharia, such as no alcohol and separate public areas for men and women as indicated by the Muslim hotel owners.

These differences mean that currently there is no set standard for sharia hotels. "There is no benchmark. Sharia is not very well defined. Different people have different interpretations of what sharia is," asserts Tamani GCC sales and marketing director Roddy Gordon.

Similarly, the Radisson Blu Residence, Dubai Marina - a sharia compliant property - is still fine tuning its sharia values.

"The sharia law is very demanding, but we're not 100% compliant. We're not serving alcohol and we have separate recreation areas for women and men," explains general manager Cornelia Erhardt.

But that was not always the case; the hotel used to have a mixed, outdoor pool. However, during a sharia inspection the hotel was advised this could not be permitted.

To accommodate guests, Erhardt will soon be launching a shuttle bus service to the beach for families who wish to sunbathe and enjoy the water together.

While the hotel claims to receive a healthy mix of guests; 70% international: 30% intraregional, communicating the message of what the hotel offers to potential visitors familiar with the Radisson brand can be a challenge.

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