UAE hotel company Rotana to launch pilot with Airbnb in Dubai

The company eyes opportunities in Syria following reconstruction efforts as well as Iraq and Africa

Rotana's acting chief executive Guy Hutchinson said the company will see strong single-digit growth in revenues in 2019.  Khushnum Bhandari for The National

Rotana, a private hotel management company in Abu Dhabi, will pilot a direct distribution agreement with Airbnb in Dubai, even as it seeks opportunities for expansion in Syria, Africa and eastern Europe, according to its acting chief executive.

"We’re launching a pilot in Dubai for a direct distribution agreement between us and Airbnb. It’s starting now,” Guy Hutchinson said in Abu Dhabi. He did not provide details about the number of properties that will be included in the pilot project.

The agreement with Airbnb, which operates an online marketplace for the hospitality sector based on voluntary listings, is a sign of the regional industry’s embrace of the technology company. Airbnb, which owns no hotel or room inventory and works on the basis of the sharing economy, has been perceived as a threat to regional hotel operators and developers, offering low-cost budget rooms in a sector that has traditionally been geared to higher-end offerings.

Residential and property listings on Airbnb in the UAE require government regulatory approval. Rotana’s pilot is the first time in the UAE a hotelier has publicly entered into an agreement with the technology company.

Rotana, which is not publicly traded, recorded 3.5 per cent growth in occupancy, as well as a 2.3 per cent increase in its average daily rate and 5.9 per cent increase in revenue per available room in Abu Dhabi during the January and February period. The company plans to add 13 new hotels this year, with one in the UAE and the rest across the Middle East and Africa, which it is hoping to build as its next hub.

Rotana, which last month opened a new hotel in Baghdad – the Babylon Rotana – is considering opening a property in the southern oil-rich province of Basra in the future.

The company, which had earlier operated a property in the Syrian capital of Damascus, is seeking possible developments in the country, as reconstruction efforts get under way following the defeat of .

“We had an asset in Damascus until about two years ago and before the troubles began. We’re starting to really to see activity,” said Mr Hutchinson.

"I think shortly in about six to 12 months, those are going to consolidate and there will be things to talk about. We can already see conversations starting around developments, conversations that we’ve had and put on the back burner."