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Enough rooms already in Dubai: hotel mogul
KHALAF Al Habtoor, the Dubai billionaire who added 1,600 hotel rooms to the city through one project alone, said that the market is now saturated and he's looking to expand elsewhere.
"I would not recommend any expansion in hotels at all to anybody," Mr Al Habtoor said in an interview with Bloomberg TV.
The group's beach properties are doing well, "but with very low rates". His city hotel occupancy is fluctuating and "the rates are not great", he added.
The tycoon revealed that he is currently deciding whether it's best to build or acquire between seven and 10 schools.
He's also studying building a specialised hospital with about 100 beds.
Mr Al Habtoor is planning to fund the investments through a mix of debt and equity.
"There is an area which is doing very well," the Al Habtoor Group chairman said as he discussed the slowing economy. "In education, we are doing very well."
He has spent the past few years building hotels and homes across Dubai.
He constructed a complex on the city's main road and spent US$500 million building a resort near the St Regis Hotel at the centre of three polo fields.
But a regional slowdown after oil prices dropped in 2014 hurt demand in Dubai's hospitality sector, while a glut of new properties has dragged down rates.
He called on Dubai's government entities to halt hotel development, even on unfinished projects, as increasing supply causes room rates to decline.
"Nakheel is announcing 8,000 rooms. Why?" he said. "We have enough rooms. I can give them 5,000 rooms."
Outside Dubai, Mr Al Habtoor bought hotels in the UK, Austria and Hungary to add to properties in Lebanon.
His company is also a distributor of Bentley, Bugatti and Mitsubishi cars.
The billionaire says that while pressure is still being felt across the economy, third-quarter results across his car businesses give him hope. BLOOMBERG