Key Points
- UAE hotel occupancy fell to 67.6% in September from 79.9% a year earlier, and Dubai international visitors dropped 44% to 6.97 million through August.
- Dubai short-term rental forward bookings are down 37.5% for November and about 26% for December and January, versus a 6% to 8% gap in late September.
- Nine foreign airlines have suspended Dubai service into 2027, and one analyst said events alone cannot fill hotels without restored air access.
Summary
Gulf hotels are heading into their most important quarter well behind last year, with operators and analysts pointing to travelers delaying or canceling trips ahead of the November 3 U.S. midterm elections and fears of renewed strikes on the region afterward. UAE hotel occupancy fell to 67.6% in September from 79.9% a year earlier, according to CoStar, and Dubai’s international visitors dropped 44% to 6.97 million in the first eight months of the year, according to Dubai’s Department of Economy and Tourism. Short-term rentals have deteriorated fastest: AirDNA data shows November forward bookings down 37.5% year over year as of October 30, with December and January roughly 26% behind, a sharp decline from late September when the gap was 6% to 8%. Airline capacity is a compounding problem, with KLM, Singapore Airlines, Wizz Air, Cathay Pacific, United, Air Canada, Finnair, Luxair, and Virgin Atlantic suspending Dubai flights into 2027. Business travel is also being pulled, with ExxonMobil and Chevron reversing executive travel plans to Adipec in the UAE over security concerns, Reuters reported. Staycations, long-stay guests, and visitors from India, Russia, the UK, and Eastern Europe are cushioning the quarter, but one analyst estimates international tourists generate 70% of Gulf hotel revenue. Dubai has responded with incentives including the new invitation-only Dubai Access Club, which offers a five-year multi-entry visa, a SIM card, and AED 2,000 ($545) in spending credit.