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Sun 3 Jan 2010 12:11 PM

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Abu Dhabi hotel rate caps 'redundant' in 2010

Tourism official says rate limits unlikely to be used amid much increased competition.

Hotel room rate caps during major events in Abu Dhabi are unlikely in 2010 due to increased competition among a growing number of tourism offerings, according to the Abu Dhabi Tourism Authority (ADTA).

The authority, which has implemented rate ceilings in the run up to and during certain major events in the past, said the policy would probably not be needed due to "accommodation inventory shifts in the market" which has naturally led to a more competitive rate environment.

"Market forces are by themselves producing a more competitive environment making it easier for major meetings and events producers to satisfy demand from participants and visitors," said Nasser Al Reyami, ADTA's director of tourism standards.

He said the UAE capital now had some 17,000 hotel rooms in 111 hotels or hotels apartments which, Al Reyami said, was "a much improved scenario since this time last year".

He added that at the beginning of 2009, it was "genuinely difficult to secure a room in Abu Dhabi".

Over the past 12 months, 4,500 rooms have come online in 11 new hotels with 2,250 of them in seven properties on Yas Island.

"In 2010 we anticipate a further 5,000 rooms coming on line. This new hospitality landscape has changed the entire demand/supply equation and competition is increasing with the obvious impact on rate structures. These makes the need for rate caps virtually redundant," he added.

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