By Claire Ferris-Lay
Hospitality group chiefs say price war looms as occupancy rates slump in the emirate due to global recession.
Hotels in Dubai have slashed their rates by up to 40 percent in a bid to attract tourists amid the global downturn.
The recession in Europe, the emirate’s largest tourist source market, has caused a steep decline in occupancy rates, forcing many hoteliers to revert to summer rack rates.
“Some five star hotels have reduced their rates by as much as 30-40 percent, which is similar to their summer prices,” Amine Moukarzel, the senior vice president and managing director of the Golden Tulip group of hotels told Arabian Business.
The number of tourists visiting the emirate has dropped since the downturn. In October, the most recent figures available, occupancy rates in Dubai fell by four percent, according to STR Global.
But hoteliers fear the last two months and the first half of 2009 could be worse as bookings have slowed. “Occupancy rates are a lot lower than the same period last year,” said Neil Rumbaoa, director of communications at the Shangri-La hotel in Dubai.
Moukarzel said occupancy at the Golden Tulip hotels in Dubai and Sharjah had dropped 22 percent.
In addition to price cuts, a number of hotels have introduced value added packages. The Shangri-La, Dubai has a number of special offers including buy one, get one night free in any of its suites, while Jumeirah Emirates Towers was offering a weekend package including complimentary breakfast and dinner with one night's accommodation in December.
The Palm Jumeirah’s star attraction, Atlantis did not allow any guests to book less than seven nights during the festive season.
Last week, the director general of Dubai’s Department of Tourism and Commerce Marketing (DTCM) said the emirate’s hotels would reduce rates by half later in January as part of a campaign to boost tourism.
The initiative, said Khalid Ahmed bin Sulayem, director general of DTCM, prices would be slashed between 40-60 percent during the month long Dubai Shopping Festival, which runs from Jan. 15 to Feb. 15.
In addition, hotels will also offer 25 percent reduction in the prices of food and beverages, he said.
what about the airlines? They need to drop their fares in order to get people here! Qatar is the only competitive airline in the Middle East right now. Emirates is growing too big for its own boots!
Never mind the airfares to the UAE, what about the extortionate prices of trying to get out of here? On average, a flight from Dubai and Abu Dhabi to Europe is double the same flight and same airline coming to Dubai and Abu Dhabi.
I am taking an incentive group to the Sheraton Hotel, Jumeirah Beach from 21 to 27 January 2009. The hotel has charged top, top rates, will not give me as travel coordinator a complimentary or reduced room rate and the hotel will also not pay any commissions for this booking. On reading your article, one wonders if the Sheraton are on this planet????