By Gavin Davids
'Iraqi religious tourism market lacking quality accommodation' - Range CEO
A UAE based hospitality group has announced the launch of Karbala’s first modern development, a $100m, 624 rooms, five star hotel property that will cater to pilgrims and visitors to the Iraqi holy city.
Munaf Ali, chief executive officer of Range Hospitality, which is developing the property in conjunction with Shaza Hotels, said that the project would begin construction in February 2011, with construction aimed to be completed by 2013.
“We launched the project over a year ago and we have had a great response from investors to the actual end users. We originally raised the seed capital early in 2010, and we were massively oversubscribed, even in this economic environment,” Ali said, adding that Abu Dhabi based Noor Capital helped source the funding for the project.
Designed by Dewan Architects and Engineers, the UAE based firm behind projects such as Yas Hotel in Abu Dhabi and the Baghdad Rotana Hotel, the Al Rawdatain Gardens hotel project will be operated by Shaza Hotels, a joint venture between Guidance Hotel Investment Company and Kempinski Hotels.
Simon Coombs, president and CEO of Shaza Hotels said the luxury brand would be able to use its experience in catering to religious markets to provide a ‘contemporary, luxury service’ to Muslim pilgrims from across the world.
Shaza Hotels launched their new hotel in Medina on Sunday, and Coombs said that its specialized needs would allow the brand to perfect its strategy for the Karbala project, where religious considerations set it apart from normal hospitality operations.
With Shia Muslims making up 10 to 15 percent of the world’s 1.8 billion Muslim populations, holy Shia sites like Karbala are expected to witness a swell in pilgrim numbers as the political situation in Iraq stabilises. Officials are estimating that 12 million pilgrims will visit the city on the day of Arbaeen in 2010.
As pilgrim numbers increased, Ali said that the world traveller, or pilgrim, was getting more sophisticated, which meant that the city’s existing facilities would not be able to cater to their needs and specifications.
A recent report by Business Monitor International said that Saudi Arabia is expected to receive 12.91 million religious tourists in 2010, a figure that is expected to grow by 6.5 percent year on year. The Saudi Commission for Tourism and Antiquities (SCTA) has reported that tourism revenue will increase by 4.8 percent this year to reach $17.8bn, and is expected to reach $31.4bn by 2015.
Ali added that this meant that the Iraqi religious tourism market was ripe for a luxury developer to enter, as the accommodation in and around Karbala was of an insufficient standard to cater to pilgrims who wished to travel in comfort.
“I’m very confident in attaining occupancies in Karbala. All the evidence seems to indicate that with the pricing now for relatively low grade accommodation, we’re seeing some very healthy average rates, so we want to offer something that offers value, and I think we’ll see a very strong demand for that,” Coombs added.
The two firms have also collaborated on another project in Mashhad, Iran, which is currently scheduled to be operational in 2011, with 70 percent of the work on the hotel completed.