EXCLUSIVE: Uncertain future for Hilton Abu Dhabi

Plan could see building change hands or cease being hotel altogether
EXCLUSIVE: Uncertain future for Hilton Abu Dhabi
The Hilton Abu Dhabi could be on track for a major overhaul towards the end of this year.
By Elizabeth Broomhall
Mon 02 Apr 2012 09:02 AM

The Hilton Abu Dhabi could be on track for a major overhaul towards the end of this year, as hospitality consultants weigh up the building’s viability.

The 35-year old property, located on the UAE capital's Corniche, could change hands or use under a new plan which will see owners maximise the space and land available.

“We have used two different consultants to look at the best use for that property,” Richard Riley, CEO of owner Abu Dhabi National Hotels (ADNH), told Arabian Business.

“We’ve got a [Jumeirah] Etihad Towers, we’ve got a St Regis and we’ve got a lot of new hotels along the strip, so we want to make sure we maximise that beautiful property. There’s also a very large car park behind it, there’s a lot of developable land there.

“But we haven’t made any [concrete] plans yet. The reality is we will move rather carefully because we need the market to settle.”

Asked if the building would continue to operate as a hotel, Riley said discussions had not yet taken place at board level.

He added that decisions had also not been made on whether to sign up a new operator, but hinted that this could be a possibility.

“The Hilton has been there for almost 35 years so there’s a lot of brand equity in having the Hilton brand there, but that doesn’t mean [it must remain].”

Abu Dhabi has long been trying to establish itself as a tourism hub in a bid to diversify its economy away from oil and boost its overall GDP.

However, the emirate has recently opened a large number of luxury hotels which threaten to undermine nearby properties.

In November last year, five major hotel brands launched Abu Dhabi properties within days of each other, adding 1392 hotel rooms to the emirate’s inventory.

Among them were the Westin Golf Resort and Spa, the Rocco Forte hotel, the 400-room Jumeirah Etihad Towers, the Park Hyatt Saadiyat Island and the 229-room Centro Al Manhal Abu Dhabi by Rotana.

Other top names such as the Hyatt Capital Gate came online early this year, while hotels such as the Rosewood and the Ritz Carlton are also eyeing 2012 openings.

Analysts say the large number of rooms puts pressure on hotel rates and could force some smaller properties out of business.

“Across the whole Gulf region, there’s a lot of old stock, particularly old trophy, five star stock, with good brand names but is in dire need of refurbishment,” said Gavin Samson, director of hospitality experts Christie and Co in the region.

“In Dubai a lot of hotels are spread out, so the impact isn’t as great. In Abu Dhabi, on the Corniche you’ve got the majority of existing stock which is old, about to be blown out of the water [by new properties].

“It’s in such a tight geographical area that you can very quickly see which are the old hotels and which are the new hotels. And I think that accentuates the problem -you’ve got a lot of old stock in close proximity to a lot of new stock in certain locations. In Dubai the issue isn’t as concentrated.”

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