Dubai: Dubai ranks alongside Beijing, Shanghai, Bangkok and Guangzhou as a rising giant of the global hotel real estate sector, according to a new report from professional services firm JLL.
The report — The Changing Global Landscape of Hospitality — identifies five groups of major markets offering different risks and opportunities for hotel investors and operators.
“The global hotel industry is being reshaped by technological disruption, changing consumer behaviour and new market players,” said Lauro Ferroni, Global Head of Hotels and Hospitality Research at JLL. “This structural shift has encouraged us to rethink how we assess market opportunity and risk, which was one of the driving forces behind this report.”
Global giants account for half of all hotel real estate investment. They have deep concentrations of business and leisure activities and support a large and diverse leisure industry. The list of 9 cities includes London and New York, which together account for 30 per cent of global investment — more than $23 billion over the last three years.
Rising giants such as Dubai are maturing quickly and rival the global giants in size and prestige, but are yet to attract the same level of investor interest. The report notes that Dubai’s supply pipeline “continues to be among the largest in the world, representing 50 per cent of an already substantial market”, but that the pace of supply is having in impact on hotel performance despite increasing demand.
The report suggests Shenzhen, Moscow and Seoul could soon join the rising giants, but that geopolitical tensions and economic headwinds have knocked Istanbul and Sao Paulo out of the group.
Gateway cities such as Amsterdam, Berlin and San Francisco have strong investor interest but smaller scale markets than the giants. They account for about 25 per cent of total global investment. US cities dominate the list of 15 gateways.
JLL defines new world cities as mid-sized, liveable cities with robust infrastructure and economic specialities that allow them to punch above their weight. They include Dublin, Copenhagen, Edinburgh and Seattle.
Finally, emerging hotspots such as Jeddah, Riyadh, Mumbai and Chennai are among the most dynamic hotel markets in the Middle East and South and Southeast Asia.
Hotel market groups
Global Giants: Hong Kong, Las Vegas, London, Los Angeles, New York, Orlando, Paris, Tokyo, Washington DC.
Rising Giants: Bangkok, Beijing, Dubai, Guangzhou, Shanghai.
Gateways: Amsterdam, Atlanta, Berlin, Boston, Chicago, Dallas, Houston, Miami, Munich, Osaka, Phoenix, San Diego, San Francisco, Singapore, Sydney.
New World Cities: Copenhagen, Denver, Dublin, Edinburgh, Melbourne, Seattle, Vancouver.
Emerging Hotspots: Bengaluru, Chengdu, Chennai, Delhi, Hanoi, Ho Chi Minh City, Hyderabad, Jeddah, Kolkata, Manila, Mumbai, Riyadh.
