By Neil Halligan
Hotel group signs 11 hotels in the last 16 months
A senior Middle East executive with InterContinental Hotels Group (IHG) has said the recent drop in room rates and revenues was not a cause for major concern.
Four and five star hotels in Dubai saw average room rates (ARR) fall by 5.5 percent to $380.85 in March, according to the latest data from HotStats.
An increase in new supply coming into the market, combined with the drop in visitors from Russia are among the main factors attributed to the drop, but Pascal Gauvin, chief operating officer, India, Middle East & Africa, IHG said he has no concerns about the long term effect.
“We have been here a long time and we've seen Dubai transforming and still transforming. We're very confident for the future of Dubai. We have to bring all our brands here,” he said.
“It’s (Dubai) an amazing market. I think there will always be fluctuations. If you compare to the year before or last year, it was just exceptional here. You can't always stay at the top and we are very confident for the future.
“Honestly, long term, and this business is long term, there is absolutely no issue,” he added.
Gauvin said IHG has not witnessed any significant drop and said their confidence in the market is reflected in the investment they have made in signing new hotels across the region.
“We've not seen any slowdown; in fact in the last 16 months we've signed 11 hotels, which is quite healthy,” he said.
Saudi Arabia, he said, was a key market for the company, with significant new hotels in the pipeline.
“Saudi Arabia is very important to us. We are celebrating 40 years in Saudi and in the future we will open Holiday Inn Mecca, the largest Holiday Inn in the world. We're very excited about that,” he said.
“We have nine hotels in the pipeline in Saudi Arabia. We are the number one operator in the country,” Gauvin added.
IHG also has a Crowne Plaza planned for ITCC, a new area in Riyadh; its second InterContinental in Riyadh in the King Financial District and a Hotel Indigo in Riyadh, the first one in the Middle East.