Hotel industry must prepare for a sharp awakening from Covid-slumber
to take advantage of new opportunities
The region’s hospitality sector needs to prepare itself to cast aside the shackles of Covid-19 and embrace opportunities for sustained growth, driven by the success of government vaccination programmes, the emergence of new markets, and a reduction in key geopolitical tensions. These opportunities will be among the key talking points at the Gulf and Indian Ocean Hotel Investors’ Summit 2021 (GIOHIS) in Ras Al Khaimah on 15-16 November.
The hotel investment community has had a torrid time during the pandemic, with some hotel owners “clinging on in order to ride out the storm”, according to Simon Allison, CEO of hotel owners’ alliance, HOFTEL, and organiser of GIOHIS. He believes, however, that the bottom of the market is close to being reached, and this will provide the stimulus for fresh investment from those looking to take advantage of a post-Covid tourism boom.
“There are a number of factors coming together at the same time which bode well for the recovery of the Gulf’s hospitality sector,” says Allison. “They offer an interesting, but complex environment for members of the hotel investment community to consider their strategies, with the potential for strong returns.”
Key issues which will impact the hospitality sector include:
- The speed of the region’s vaccination drive, especially in the UAE, which can see it become a safe haven compared to destinations which have been less able to control the pandemic.
- The improvement of relationships with Qatar and Israel, two markets which can provide a new source of tourists and eventually, cross-border investment. The lessening of regional tensions will also attract more tourists from afar, such as the US.
- The region’s continuing success in the strategic diversification of its tourism sector. In the UAE, for example, while Dubai remains the centrepiece for luxury hospitality combined with retail and entertainment, other emirates have built strong niches – Ras Al Khaimah has established itself as an alternative beach destination which also offers a plethora of adventure tourism activities; Abu Dhabi has cemented its role as a cultural hub, while Sharjah is building up a strong portfolio of boutique properties.
- The emergence of a major new market player. The Kingdom of Saudi Arabia has huge potential, with world-class hotels under construction, a diverse offering catering for cultural, adventure and leisure tourism, and an array of talented executives working to ensure its success. This can be seen as a threat to current market players, or an opportunity for shared regional growth.
Allison adds: “The consequences of Covid-19 have been terrible for the hospitality sector, and above all we cannot lose sight of the fatalities among hospitality sector workers, the enormous job losses and the number of hotel owners left teetering on the brink of financial ruin”.
“We can now see light at the end of the tunnel, and I firmly believe that the most effective way for the sector to get back on its feet is by working together to understand the challenges we face, and to look carefully at the opportunities to open a new and exciting chapter.”
This sentiment of optimism for economic recovery is echoed in a recent survey by PriceWaterhouseCoopers (PwC) which highlighted that more than half of Middle East CEOs are confident of post-Covid growth.
Khalid Anib, CEO, Abu Dhabi National Hotels PJSC, agrees that the regional hospitality sector is well positioned for post-Covid growth, but notes that the changing needs and expectations of tourists and other travellers must be considered. He says: “As the world emerges from Covid-19 it will be vital for destinations to have clear strategies for attracting visitors, while giving them confidence in measures being taken for their health and safety at hotels, resorts and attractions.
“Our region has a good opportunity to rebound quickly from the challenges of the past year, and this is being strengthened by the continued investment in value-added areas, such as cultural attractions, outdoor activities and entertainment.”
Khalid is one of the key speakers at GIOHIS, which aims to bring around 300 of the top hotel owners, developers and operators from the Gulf, East Africa, the Indian Ocean islands, ASEAN and Australia together to discuss topical issues affecting the industry, ideally in person, but if necessary, also via remote links. Being run by hotel owners’ alliance HOFTEL, rather than a commercial media or conferencing company, means that GIOHIS can be upfront about addressing the sector’s key issues in a transparent and compact forum full of decision-makers.
Olivier Harnish, Head of Hospitality, Public Investment Fund of Saudi Arabia, says: “GIOHIS has always been a key event in my calendar, given the relevance and quality of its discussions. With the turbulences our industry has gone through in the past year, GIOHIS 2021 will be more important than ever. We will have plenty to discuss with regards to the implications of the post-Covid future for all stakeholders in the hospitality sector. I look forward to doing so in person.”
This year, GIOHIS will take place at the Waldorf Astoria & Al Hamra International Conference Center, Ras Al Khaimah. Key speakers will include: Khalid Anib, CEO, Abu Dhabi National Hotels PJSC; Olivier Harnisch, Head of Hospitality, Public Investment Fund of Saudi Arabia; Raki Phillips, CEO, Ras Al Khaimah Tourism Development Authority; Fettah Tamince, Founder and Chairman, Rixos Hotels; Andrew Humphries, Acting CEO, Katara Hospitality and Ronen Nissenbaum, President and CEO, Dan Hotels – Israel.
Raki Phillips, CEO of Ras Al Khaimah Tourism Department Authority (RAKTDA), and a key supporter of the event, says: “We are delighted to be hosting GIOHIS, the leading regional investment conference at the Al Hamra International Conference and Exhibition Centre, the first meeting facility to be certified by Bureau Veritas. Hosting high calibre programs such as GIOHIS, aligns the destination’s strategy for sustained and resilient recovery while showcasing the best that Ras Al Khaimah has to offer. Genuine hospitality is at the root of everything we do at RAKTDA and as such it is always a pleasure to collaborate with leading hotel operators as we share ideas and insights into what the ‘new normal’ means for the growth and development of the tourism sector from an investment perspective.”