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Ongoing challenges present sporadic opportunities

Author: Zayd Maniar, International Liaison Partner, Crowe UAE

Published: 08 Jun 2021

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Public holidays are a boon for UAE hotel staycations. Local tourists require a sweetener in form of full board or reduced rates.

This may be a boon for occupancy rates and perhaps why the UAE recorded the second highest occupancy rates, after China, during 2020. Resulting reduced hotel valuations make trophy assets ripe for picking. The UAE-based company that owns the St Regis resort at Saadiyat Island and the Luxury Collection Desert Resort at Al Wathba has been sold in a deal worth nearly GBP 330 million. Spurring a frenzy of similar M&A transactions.

The slow opening of international borders provide hope for hotel management companies and the IATA, for recovery of airlines. Additional costs need to be factored in by holiday makers as well as a shift in mindset. Travelers may need to factor in additional testing and extended stays owing to mandatory quarantine. Perhaps the reason why, London's luxury stores 'hurting badly' without high-spending Gulf and Chinese tourists. However, I suspect this is also since VAT is no longer refundable.

Travelers today, are increasingly aware of their personal well-being, in addition to environmental sustainability. Wellness Guru Deepak Chopra sees wellbeing as an interconnected web of digital tools, individual soul-searching and interpersonal experiences. It is no surprise then that Saudi Arabia and the World Bank have launched a global fund dedicated to sustainable tourism. Clean solar energy is aiding efficient desalination of sea water. Turning deserts into lush green sanctuaries had been an elusive nirvana. Use of technology, solar power and water conservation has seen many arid deserts in the region bloom with lush vegetation.

Al Barari Gardens
Al Barari Gardens

Al Barari is one such community (pictured above) where sustainable recycling of water through a river across the community has helped nature thrive. Even during the harsh summers, humidity is noticeably reduced, and temperatures are lower by up to 5 degrees Celsius.

*The views expressed are the author’s and not ICAEW