Gulf hotel play hits pause; investors stay upbeat
Dubai and New Delhi: Hotel expansion in the Gulf is slowing down due to regional unrest caused by the West Asia conflict, yet investors remain optimistic about future opportunities. Indian Hotels Company (IHCL), which manages the Taj brand, anticipates delays in some Saudi Arabia and Bahrain projects but is still exploring options in Oman, Abu Dhabi, and Dubai.
Lemon Tree Hotels exited its Dubai operation, while Wynn Al Marjan in Ras Al Khaimah delayed its opening to September 2027, adding $600 million to costs. IHCL targets 10 operational Gulf hotels over the next two to three years, currently operating three in Dubai. Saurabh Tiwari, IHCL's vice president for the Middle East, noted a three to six-month delay in some projects, particularly in Bahrain.
Radisson Hotel Group's global president stated that while Saudi Arabia is less affected, major UAE markets have been severely impacted. Experts believe operators are reassessing project economics, demand, and investment timing, resulting in a slower pace rather than a retreat from the Gulf. Marriott International has over 410 properties and 250 projects in the Middle East & Africa region, with recent openings and new openings planned for Riyadh and the Red Sea.
The Leela Palaces Hotels & Resorts plans to relaunch a 23-acre beachfront resort in Dubai’s Palm Jumeirah in 2028. Investors are still interested in the Gulf market, with IHCL in talks with potential investors in Oman and Abu Dhabi.
Written by urgent.news from The Economic Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
