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AHIC: Midscale Hotel Market Presents Most Opportunity

by Sarah McCay Tams, Contributing Editor, EMEA |

This year’s Arabian Hotel Investment Conference, which took place at the end of April in Dubai, highlighted a number of opportunities for the hotel sector in the Middle East, with the midscale market seen to be giving the luxury segment a run for its money in the region.

STR Managing Director Robin Rossmann took to the stage to deliver his insight into midscale pipeline and performance in the GCC.

STR data showed that the Midscale market had out-performed the Upscale & Upper Mid Classes and Luxury & Upper Upscale classes since 2011 across the GCC.

According to Rossmann, mid-market hotels offer significant growth potential from intra-regional travellers and increased demand for affordable accommodation options.

The midscale hotel market is giving luxury a run for its money in the GCC region. Click To Tweet

Already, a number of mid-tier brands operate in the region, including Premier Inn, Ibis and Holiday Inn Express. However, brand penetration in the midscale market is increasing.

The Middle East has seen the recent arrival in the market of U.S.-based Choice Hotels. Steve Joyce, president and CEO, delivered a keynote at AHIC providing insight into the mid-market industry.

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According to Joyce, the growing middle class and a demand from travellers for quality, midscale accommodation, led to the company to enter the market with three of its brands: Clarion, Comfort Inn and Quality.

Rezidor is another hotel company looking to increase its midscale portfolio in the Middle East. Elie Milky, VP of Business Development in the MEA region, said 20% of the company’s regional properties were midscale, with more in the pipeline. He also endorsed lowering operational costs and the staff-to-guest ratio, saying: “Operational efficiency starts at the development of the product; you may not need a comprehensive back of house and you can reduce the staff-to-guest ratio.”

Other hotel companies looking to expand into the mid-tier market in the region include Kempinski and regional hotel brand Shaza, who are partnering on a new venture called Mysk by Shaza, which will be positioned in the upper-midscale bracket.

For more on this story, visit HospitalityNet. 

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Sarah McCay Tams, Contributing Editor, EMEA

Sarah McCay Tams, Contributing Editor, EMEA

Sarah is contributing editor covering Europe, Middle East & Africa (EMEA) for Duetto. An experienced B2B travel industry journalist, Sarah spent 14 years working in the Middle East, most notably as senior editor – hospitality for ITP Publishing Group in Dubai, where she headed up the editorial teams on Hotelier Middle East, Caterer Middle East and Arabian Travel News. Sarah is now based back in the UK.
Sarah McCay Tams, Contributing Editor, EMEA

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Sarah McCay Tams, Contributing Editor, EMEA

Sarah is contributing editor covering Europe, Middle East & Africa (EMEA) for Duetto. An experienced B2B travel industry journalist, Sarah spent 14 years working in the Middle East, most notably as senior editor – hospitality for ITP Publishing Group in Dubai, where she headed up the editorial teams on Hotelier Middle East, Caterer Middle East and Arabian Travel News. Sarah is now based back in the UK.