By Andrew White
Why Dubai's Bawadi development is set to outshine the lights of Vegas.
In a plush Emirates Towers’ office high above the bustle of Sheikh Zayed Road, Arif Mubarak, CEO of Bawadi, lets out a rather exasperated sigh.
“This is not replicating Las Vegas because it’s totally different. People relate Bawadi to Vegas because it’s one boulevard or strip,” he insists, before adding brightly: “But then ours is at least four times the size of theirs.”
Unveiled by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, in May 2006, Bawadi is the world’s largest hospitality and leisure development.
Naturally, and in typical Dubai fashion, the US$27.2bn mega-project — which features a 10km-long ‘boulevard’ of unique hotels at its epicentre — is also aiming to become the world’s leading hospitality and leisure destination.
Bawadi, a member of Tatweer, will feature a series of world-class thematic developments — including Asia Asia, the world’s largest hotel with 6500 rooms. Just don’t mention the US’s equally sun-scorched, hotel-happy desert city.
“This is 5th Avenue, Oxford Street — it’s a mixture of all kinds of different cities,” maintains Mubarak, with a smile. “The concentration of culture, history and leisure is what will attract people to Bawadi — you will never find that many hotels, that many shopping malls, and that many entertainment venues all in one district. There will be massive variety all within one area.”
Other hotels announced so far include the Ottoman Palace Hotel and Resort, which will replicate the 16th and 17th centuries, the US$218m Al Maghreb Resort and Spa, which will recreate the magic of Morocco, and the US$504m America Hotel and Resort, that will showcase New York Broadway shows as a permanent attraction.
Bawadi will also host the US$327m Palaces Hotel and Resort, and the US$354m Holly Bolly Hotel and Resort, which will fuse the red carpet glamour of Hollywood and Bollywood. In total, the project will feature 31 luxury hotels, and offer 29,200 rooms to visitors from all over the globe.
The project’s first phase is scheduled for completion in 2011, with the opening of three hotels on the ‘Bawadi boulevard’. Work is well underway, however — last month, Bawadi announced the completion of road work as part of the initial US$1.09bn infrastructure development that began in June 2006.
“It’s really an accomplishment to achieve what we have achieved so far, in such a short space of time,” says Mubarak. “We want the main road to be a boulevard, so you have four lanes, then pathways, and then the hotels. Part of the vision of Bawadi is to make sure that the whole 10km is a walkable environment, because that is one of the missing elements in Dubai.
“That is the design we are working to, because it’s not about just staying in a hotel, it’s about spending time outside the hotel, so you will be spending more money,” he continues.
“That is something we want to do with Bawadi — we want to extend the average number of nights that tourists will spend in Dubai.”
Mubarak insists that the hotels themselves will offer a range of accommodation hitherto lacking in the emirate.
“Right now the majority of hotels in Dubai are five-star, and there are no family-driven hotels,” he says.
“There are no three-star affordable hotels where people can arrive, throw their bags down, go to the theme park, have fun, then come back and sleep. You don’t have your smaller boutique hotels, and you don’t have themed hotels.”
This cosmopolitan mixture, he contends, will prove the differentiator for Bawadi.
“We have three-star, four-star, and five-star hotels,” he says. “Boutique, four-star business, family hotels. It’s all about credibility, capability, and the track record of that operator.
“Each of our partners has a unique idea and positioning, whether you’re talking about Holly Bolly, or Ottoman, or Al Maghreb, or Pirates,” he continues. “It’s really interesting the way they have positioned their hotels. I’ve seen the conceptual designs, and you would be amazed by the content because there’s simply nothing else like it in Dubai or elsewhere in this region.”
Agreements will be inked this month with two “very interesting” new partners, according to Mubarak, who nevertheless firmly insists that Bawadi “is not in a sales game — we don’t just want to sell for the sake of it.
“It’s all about getting the right guy, getting the right partner,” he explains. “We need experienced people, people who have done it before, people with quality, and people who know and believe in the vision. This is what we look for in our partners.”
Mubarak himself clearly believes in ‘the vision’, and is adamant that Dubai will not struggle to fill the new rooms, which in total represent a 100% increase on the number currently available.
“We have a business model that we have created internally with KPMG, and at the same time we have a visitor model, where we have tackled how many visitors we need to have by 2011, 2012, 2015 and so on,” he explains.
“Based on that critical mass, we are developing the next step,” he continues. “You can’t just have three hotels up by 2011 if you don’t have the other content, as far as shopping, and both paid and unpaid entertainment.
“That mix is really the crucial thing, which will help us to steady any fluctuations and have a steady line where we have high occupancy rates for hotels, because we need to make sure that our hotels and all the other hotels are occupied all year.”
Even Dubai’s infamously hot summers are unlikely to deter would-be tourists, believes Mubarak.
“If I go back to ‘06, the average occupancy rate in Dubai for the whole year round was above 75%, so really we don’t have that much of a problem in summer,” he insists. “Besides, for seasonal tourists Bawadi will be tackling the issue of how to really make this project attractive to people in both summer and winter. You will have both indoor and outdoor activities, and we need to balance that.
“We have deadlines and timelines for each component within Bawadi, in terms of both hard and soft infrastructure, and even hotel completion,” explains Mubarak. “Execution is very important to us, because on-time delivery is crucial. We are going to deliver on time, there are no delays, and we are moving ahead in terms of the project plan that we have so far.”
Moreover, Mubarak is keen to emphasise the flexibility of the Bawadi plans. After all, as Dubai expands at such a rapid pace, there are those who have suggested that the emirate may suffer from an over-saturation of high-profile developments.
“For such a large project, we’re not saying we’re going to build all of it. Each phase will determine the success of the next one,” he insists.
“Right now we are assuming that we will build five more hotels by 2012 — based on the visitor model — but if there are any reasons or issues that mean different numbers come up, then that plan will be tweaked,” he continues. “After all, we can’t go ahead and build something if there is no occupancy or no need for it. We can increase or we can reduce Bawadi - it’s not about an area with a boundary where you can say ‘that’s it’.
“If by the second or third phase we need to add more hotels or more elements that we did not tackle in the first phase, then we will do that, so we can make sure that we sustain this differentiator and we are up-to-date as an international tourist destination,” adds Mubarak. “These projects are necessary for the success of Dubai and the whole region at the same time. These are not Dubai-driven projects — they are regional projects.”
Yet while Bawadi’s impact should be felt across the region, its physical boundaries run close to those of another high-profile mega-project: Dubailand. Both are Tatweer developments, and the Bawadi team maintains a policy of “collaboration and coordination” with its US$20bn neighbour.
“Bawadi is a self-contained project, so we have our own strategy,” explains Mubarak. “We don’t depend on others and run it as an independent project, although obviously whatever happens surrounding us will be complementary to us. For example, if one of Dubailand’s projects was delayed — as they are owned by investors, not by Dubailand — then I don’t think that would affect us.”
Furthermore, Mubarak is quick to stress that the two developments will not necessarily be competing for the same customers.
“Dubailand is focused on entertainment, and specifically theme parks,” he explains. “The way that we see it is that people will stay in Bawadi for specific reasons — shopping, the accommodation, or the whole atmosphere — but as far as theme parks go, we’re going for a totally different positioning.
“There is a strong connection between the two, as you can’t build a theme park without having the right atmosphere, and the right retail and shopping experience next to it,” he insists. “We are really complementing Dubailand positionally.”
Of course, it will be a few years before the two stand side by side, the latest jewels in Dubai’s already glittering crown. Mubarak readily admits that there is a long way to go, yet insists he is looking forward to the challenge.
“The project is almost eight months old, and it’s an exciting time,” he says. “I’m enjoying it because it’s something new, something ambitious, something challenging, and something unique.
“There are three cycles — planning, construction, and then operation,” he continues. “Each of these different cycles require different skill sets, and there needs to be a mind shift because you have different customers who have different needs, different people to deal with.
“At the beginning you deal with the strategy guys and the planners,” he adds. “Then you move to the contractors, the people who will build it and be on site. Then you move to the operators, and the sales people to make sure all these hotels are filled.”
The project is undoubtedly no small task, and so it is no surprise to hear that Mubarak rarely has time to spare.
“I have to get up every morning and run — I can’t just get up every morning and walk,” he smiles. “I even run back home to sleep.
“You need a balance between work and time off, but I enjoy what I am doing,” he continues. “If you enjoy doing it, I think you give it more and more, and that’s the beauty of it actually: you don’t feel it’s really working.
So when can Mubarak hope to next catch his breath?
“The end of 2011 is the big one — that’s the big achievement — and I will be running all the time until we get there,” he laughs. “I’m not sure if you’ve noticed this during your time in Dubai, but with commitment and with belief, you can deliver.”
Fighting talk, but then Mubarak’s pace of life is hardly surprising — after all, he has a lot of ground to cover.