There is an increased demand for mid-market hotels in Dubai, as more travellers are spending less of their budget on accommodation, according to the CEO of Emaar Hospitality Olivier Harnisch.
Millennial (or Generation Y) travellers are particularly spending less on hotels and more on dining and entertainment, he told Arabian Business at the Gulf and Indian Ocean Hotel Investors’ Summit (GIOHIS) in Abu Dhabi.
“They say, ‘You know what? I’m coming to Dubai and I’m only staying four days. I’m just going to sleep in my room. I want an attractive and comfortable space, but I want to spend more on dining and entertainment. That’s a trend we are seeing,” he said.
The shift in consumer behaviour is partly due to changing perceptions of Dubai, where visitors have realised that it is not only sun, beach and shopping, but also about culture, with attractions such as Dubai Opera and Louvre having opened.
However, Harnisch warned against associating guests staying in mid-market hotels as having little money to spend.
“There is a certain correlation between the spending ability of a mid-market hotel guest and a five star hotel guest, but it is not a strong one,” he said, adding that travellers have become more conscious when it comes to accommodation costs.
While the Dubai market is atypical in the sense that almost 70 percent of hotel supply is in the luxury sector, other markets in the world have more balance, Harnisch said.
Emaar Hospitality has responded by developing mid-market hotel brands such as Rove Hotels, which appeals to a different kind of market when compared to their luxury chain Address Hotels.
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