Starwood Is Losing a Third of Its Dubai Portfolio in One Shot, Which Chain Will Get These Great Hotels?

Marriott is losing the St. Regis, W, and Westin in Dubai all at once. That’s a one-third hit to the number of legacy Starwood rooms in Dubai, including the same owner pulling the St Regis Habtoor Polo Resort and Spa in recent days.

Dubai was one of Starwood’s most important markets, they had a legacy Emirates partnership similar to their Delta partnership in the US and a UAE co-brand credit card.

These properties are all owned by Al Habtoor Group, and located in the Al Habtoor City development. Al Habtoor’s Chairman seems to suggest they’ll go it alone though nearly 2000 rooms is a large portfolio to market as an unbranded product.

A local correspondent shares some details of the dispute,

– Owner manager were at odds since opening two years ago

– The hotels were mismanaged relative to JW Marriott Marquis (also 1608 rooms, largest in Dubai) next door.

– These guys fell to single digit occupancies frequently in summers, JW Marriott Marquis has no trouble ending at 100% several days through year.

– JW Marquis and this complex are adjacent (walkable sort of, opposite banks of canal, separated by 100 metres)

– Hilton and Hyatt probably can probably fill these rooms (Hyatt has no major hotels in major areas in Dubai). Hilton because these would be the 3 best Hilton’s in the city. Accor is stronger than both of those in Dubai but as a result not sure if it can take on 1600 rooms.

– IHG is also involved in the talks. They could also take em (they have only 1 major hotel in a good location – Marina). So no immediate area competition from IHG (though a nearby one opening in 12 months).


Could We See Another Park Hyatt in Dubai?

This is a disappointing development for Marriott in Dubai, since these are all excellent hotels, however if they join another global chain it could rebound to consumers focused on other portfolios.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. If this is true “These guys fell to single digit occupancies frequently in summers” No wonder they told Marriott to get lost

  2. Our 1 night stay at the StR Dubai was a mess. Haughty service followed by incompetent service, incompetent food/beverage, and then more incompetent service. The service recovery was not impressive…and I’m an Ambassador guest. The StR hard product was very nice…but the hotel location wasn’t particularly convenient to anywhere else in town.

    Also, the Grosvenor House, a Luxury Collection property, is FAR superior in terms of service, location, food/beverage, etc. So no loss to me, really.

  3. @Gary

    Am curious, which is the most classic looking Park Hyatt in the world? Vienna?
    Just wondering if it’s hypothetically possible for StR Dubai to be converted to a Park Hyatt, seems more Unbound Collection-ey. W could easily be an Andaz and Westin easily a Grand Hyatt.

    Hilton would go with a Waldorf (ex StR), Curio/new brand (ex-W), Conrad/Hilton+ brand (ex Westin) brand mix. Can’t imagine what IHG would do, Regent for StR, Intercon for Westin (I’m sure they can stretch it, Crowne Plaza would be too low a brand) but what about W – (Kimpton?)

  4. @Vineet – I think that Hyatt is willing to offer quite a bit of divergence in Park Hyatt experience. To me the Park Hyatt Abu Dhabi is the classic Hyatt physical space. There’s super modern, there’s also 80s Four Seasons, eg. they were willing to rebrand the Four Seasons Aviara a Park Hyatt without capital investment [the owners didn’t want to invest, lost the Four Seasons flag].

  5. I think Aviara is a dump/outlier though 😛

    And Park Hyatts have very very few dumps (Toronto and Tokyo are investing money, Melbourne too I think, they’re almost as consistent as Four Seasons or MO in that respect (all of whom have maybe 1 or 2 dumps at most).

    I just don’t remember seeing such a gaudy traditional Park Hyatt anywhere (since St Regis was already one of the most “gold” StRs)

  6. I guess my question is did Starwood mange those properties or just provide the flag/reservation system? That is more the question.

  7. @Ric @GhostRider5408

    Starwood/Marriott managed them directly. Franchise agreements here are rare (less than 10% of the agreements) and more commonly found with Accor or Hilton. Can’t remember a single franchised Marriott/SPG property in UAE.

    I feel like if the property had to be split between various chains, Marriott would have retained at least 1 of the 4 hotels in the complex. Marriott still manages one of Habtoor’s hotels in a different part of the city. Habtoor has existing agreements with Hilton in the same city and with Marriott internationally. For that reason alone, I see all 4 properties ending up with one chain though it would make sense to split them across 2 or more.

  8. Gary maybe no one wants to go to the UAE and all these subsidized hotels are not viable, ever considered that?

    I’m sure whatever they put out publicly is just lip service.

    Why do you encourage people to visit and support an anti-Semitic and homophobic country?

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