Luxury hotel operators in Dubai are increasingly exploring new source markets to compensate for a drop in Russian guests.
Kerzner International’s One&Only Resorts, which manages One&Only The Palm and One&Only Royal Mirage on Al Sufouh Road in Dubai, is now marketing its properties in Poland, the Czech Republic, Ukraine and Scandinavian countries. It is, however, not giving up on Russia, where it maintains an office.
Next month, the hotel group will go on a roadshow to Kiev, Moscow and Baku.
“The regional coverage of airlines such as flydubai and Emirates opens up different regions of Russia besides east Europe,” said Brett Armitage, a senior vice president for international sales and marketing at One&Only Resorts. “There is a significant downturn in the Russian market but a stronger increase [in guests] out of Kiev.”
Tourist numbers from the key source market to Dubai declined last year owing to currency fluctuations and low oil prices.
According to a Bloomberg index compiled last year, Dubai was the fourth most expensive destination in the world for a hotel stay after San Francisco, Geneva and Milan.
Last year, the number of tourists to Dubai from Russia, CIS and eastern Europe dropped by 22.5 per cent compared to the previous year, according to Dubai Tourism.
In January, Emirates deployed an A380 on its Moscow route for two weeks when demand was high. Currently, it operates a B777-300ER on its double daily flights to Moscow. The carrier withdrew its regular A380 service in November 2014.
In October, however, it increased its seat capacity by 50 per cent to St Petersburg. The city got its seventh flight per week in December.
The large number of hotel rooms to fill in Dubai also put pressure on room rates. And the emirate has the second-highest number of hotels in the pipeline – 19,846 rooms across 63 hotels in the Middle East and Africa – after Mecca in Saudi Arabia, research company STR Global said yesterday.
Mecca has the largest number of rooms under construction, with 21,068 rooms across 13 hotels.
One&Only Resorts expects to open its 10th property, a 175-room hotel in Bahrain, in the second half of next year. Its first European property in Montenegro is expected to open in the second half of 2018 with 120 rooms.
In the design phase are a 192-room property in Sanya, China, and two in Mexico. One&Only Resorts runs nine properties, including those in Mexico, Maldives and the Bahamas.
In 2014, the Investment Corporation of Dubai (ICD) bought a big stake in Kerzner International.
Istithmar World, a Dubai World subsidiary, already owns a 25 per cent holding in Kerzner. ICD also owns Atlantis, The Palm, which is also managed by Kerzner.
Another Atlantis is coming up in Sanya, and a Royal Atlantis Resort and Residences on the Palm Jumeirah.
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