Special Report: Hotel investment - The rise of regional hotel brands

02 May 2008

Developers across the Gulf are realising that the branding of their hotels and apartments is critical to their future competitiveness.

As an increasing number of hotels and hotel apartments are built, business visitors and tourists will be spoilt for choice within the next three to five years.

Currently, demand is easily outpacing supply, but in the longer term, hotel chains must create their own niche if they are to capture a share of the market.

The traditional model of a real estate investor building a complex and then bringing in an international hotel management firm to run the premises is being replaced by one where the developer manages the property itself.

Proven success by the Jumeirah Group is giving other investors such as Nakheel, Rotana and Almulla the confidence to follow its lead.

Two approaches are being taken. Some local investors are launching their own hotel brands, while others are buying stakes in established international operators to obtain the expertise needed to run the businesses.

But building a brand is not simple. Brand recognition and loyalty take time to cultivate, as does training the staff needed to provide the levels of service demanded by the region’s flagship hotels.

Although investors are in a hurry to establish and build their market share, there are some things that cannot be rushed.

 

Special Report: Hotel investments - The rise of regional hotel brands ~ Index of all stories

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