More than 11,300 new hotel rooms are expected to open across Dubai by 2027, according to a recent report by Cavendish Maxwell. Additionally, around 4,620 hotel rooms are set to enter the market this year.
Dubai’s hospitality growth and future projections
Dubai added 4,255 rooms across 19 hotels to its inventory in 2024, reflecting a year-on-year growth of almost 3 percent. As of December, the city boasted 724 hospitality establishments, totaling 151,245 keys between them, according to Cavendish Maxwell’s 2024 Dubai hospitality sector market performance report. Hotel inventory is projected to grow by 3.1 percent this year, with a 3.4 percent growth predicted for 2026. By the end of 2027, Dubai is expected to have over 162,600 rooms across 769 hotels.
Dominance of high-end accommodation in Dubai
High-end accommodation continues to dominate Dubai’s hotel offering. Moreover, nearly 70 percent of room supply falls in the high-end category in 2024. Furthermore, almost 70 percent of the upcoming supply for 2025 will be in the Luxury and Upper Upscale segments.
Gergely Balint, associate partner, commercial valuation and hospitality expert at Cavendish Maxwell, said: “Dubai’s world-leading hospitality and tourism sectors set new records. Additionally, it reached impressive milestones in 2024, with 18.72 million overnight visitors. Furthermore, the city gained prestigious tourism industry awards and added 4,255 new hotel rooms to the market. Moreover, we can expect continued strong performance in 2025, with another 20 hotels and resorts set to open, further solidifying Dubai’s position as a global hub for tourism, hospitality, business and leisure. These achievements align with Sheikh Mohammed Bin Rashid Al Maktoum’s strategic vision in the Dubai Economic Agenda D33, aiming to position Dubai among the world’s top three global tourism destinations.”
Dubai’s hospitality sector
The number of overnight visitors to Dubai grew by 9.1 percent last year, up from 17.15 million in 2023. The emirate’s tourism and hospitality momentum was also supported by its remarkable performance at the 31st Annual World Travel Awards in late 2024. Notably, Dubai was named the world’s leading shopping and exhibition destination, while Mina Rashid was awarded the title of the world’s leading cruise port and Dubai International Airport was recognized as the world’s leading airport.
Balint added: “This continued international recognition strengthens investor confidence and further solidifies Dubai’s status as a premier hub for hospitality and real estate development. Moreover, the emirate’s tourism sector continued to experience robust growth, surpassing pre-pandemic levels, contributing positively to economic expansion. In 2024, tourism contributed Dh236 billion, up from Dh220 billion in 2023, representing 12 percent of the nation’s GDP. This growth underscores the sector’s significant impact, reinforcing its vital role in the UAE’s economic development.”
Dubai’s hotel occupancy
Dubai’s hotel occupancy levels remained steady, rising to 78 percent in 2024, an increase of 1 percent compared to 2023. The luxury and upper mid-scale segments saw the largest gains, increasing by 3 percent and 2.4 percent respectively.
Dubai ADR’s growth
ADRs in Dubai reached AED 690, reflecting a slight increase of 0.2 percent compared to 2023, indicating pricing stability in the city’s hospitality market. Upscale and upper mid-scale categories saw ADR growth of 0.7 percent and 0.4 percent, respectively, while upper upscale hotels experienced a decline of 1.7 percent in ADR. Those in the Luxury segment witnessed a drop of 1.9 percent in ADR year-on-year, despite a 3 percent increase in occupancy, suggesting increased demand came at the expense of pricing.
Average RevPAR
Average RevPAR rose by 1.3 percent in 2024 compared to 2023, primarily driven by higher occupancy levels. While all segments saw growth, the upper midscale category led with a 1.9 percent increase.
