Panos Loupasis, Vice President Development, Middle East, Eurasia & Africa at Wyndham Hotels & Resorts discusses the region’s thriving hotel industry and the trends taking shape.
April is peak season for hospitality activity in the Middle East, not strictly business specific, but also in terms of communicating and highlighting the remarkable growth that the region has achieved in taking its hospitality sector to the next level of growth.
No wonder then that one question is invariably raised at every forum: Are we over-supplied? Is there room for more hotels in the region? What about the new hotel keys being readied such as the 10,000 branded rooms expected to enter Saudi Arabia this year? Will there be enough takers?
My answer to all of these is that there is room for more – but for the right hotel concepts. The hospitality sector is not set in stone; we evolve and grow to meet market needs and draw on current and future trends to deliver exceptional value to our guests and partners. That is why for Wyndham Hotels & Resorts, the world’s largest hotel franchising company and a leading provider of hotel management services, the Middle East continues to be a core region, where we see tremendous potential for growth with our diversified offering that meets the aspirations of guests across all key segments.
The Middle East & Africa market has grown at a sustained pace for us in recent years. Today, we have 57 operational hotels with almost 11,000 rooms in the region. This includes 18 hotels (over 4,000 rooms) in the UAE where we opened TRYP by Wyndham in Dubai, the world’s largest in our TRYP by Wyndham collection, as well as 15 hotels (and over 2,000 rooms) in Saudi Arabia. In addition, Bahrain is another key market for us, underlined by the opening of Wyndham Garden Manama, the largest Wyndham Garden hotel globally.
We are set to welcome more guests all across the region, with a robust pipeline of 21 hotels and over 4,000 keys in the next three years all across the region. Our strategy is based on strong research: Today’s guests are more discerning than ever before. They are youthful, connected and seek hotel experiences that bring value across every touch-point of their journey. That is why we have focused on diversifying our portfolio in the Middle East & Africa with 10 brands, each securing its own distinctive niche in the market.
This expansion, especially in markets such as the UAE and Saudi Arabia, are backed by firm fundamentals. The Dubai Tourism Strategy 2025 aims to welcome 25 million annual visitors and the promise of Expo 2020 Dubai hosting 25 million visitors are, no doubt, powerful catalysts for our industry.
This is reflected in the growth of the hospitality market in the UAE; welcoming a record 16 million visitors in 2018, Dubai, one of the world’s top tourist destinations, witnessed 8 percent growth of its hotel sector year-on-year. New markets such as China have opened even newer opportunities for the industry while the number of European tourists to the GCC is set to increase 29 percent by 2023. Similarly, Saudi Arabia, led by its Vision 2030, which focuses on strengthening the tourism sector to welcome international and grow domestic visitors, has evolved as a strategic market for sustained growth. With the roll-out of ambitious tourism-driven projects such as NEOM and The Red Sea Project, the prospects are strong.
The potential for growth comes with transformational shifts too. Demand for hotels in the region is not confined to high-end and luxury markets. There is burgeoning demand for mid-scale hotels, with PwC estimating that Dubai alone will require an additional 15,000 mid-market hotel keys to facilitate the demand of Expo 2020 and Dubai’s Tourism Strategy 2025.
The Middle East’s hotel inventory continues to be skewed towards the upscale segment with the ratio of mid-market to luxury hotels close to 50:50, compared to other destinations such as New York where the average ratio is 70:30.
Through our diverse portfolio of brands, we are delivering on our vision to make travel possible for all. From economy to upper upscale, and through the rapid expansion of our footprint, our goal is to ensure that whenever and wherever guests want to travel, there is a Wyndham hotel to suit their needs.
With the enormous opportunities that the region offers, we have an optimistic outlook for the future. We will continue to build on our presence and strengths by focusing on growing our portfolio where we know travellers want to be – and several regional destinations are at the top of the priority list of international travellers. And that is why I reiterate that the region has room for more.
Plan well, build well, and serve well. It is a strategy that helps you win.
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