The local Al-Futtaim Group is set to build a 400-key mid-range hotel in the Dubai Festival City Mall area.

The Holiday Inn branded hotel, which will be operated by Inter Continental Group, has been tendered with Al-Futtaim group receiving bids from contractors in early September.

The main construction contract is expected to be awarded in the first quarter of 2016, according to a spokesperson from Dubai Festival City Mall.

Festival City Mall is currently undergoing a AED1.5bn expansion with the mall’s main atrium being extended. The mall is also extending across the waterway that runs alongside the shopping centre, adding 34,000 square metres of space.

The local/UK Al-Futtaim Carillion was the main contractor for initial atrium work while the local Alec is working on the larger waterway extension alongside the mall.

The work is approximately 60 per cent complete, with the group expecting completion by June 2016.

The local AST is also carrying out the AED30m land reclamation work for the extension of the mall’s promenade facing the marina waters.

“An open air 50,000-square feet platform will be set up on reclaimed land from the marina in the next two months,” said Brad Merchant, general manager of the mall.

Dubai Festival City Mall receives on average two million visitors annually.

“The expansion will add 20 per cent more area to the existing 2.4 million square feet mall and increase the stores’ tally to 420,” explained Merchant during a press briefing on 21 September.