- 1 -

9-11 April 2019

AHIC Village, Ras Al Khaimah, UAE

The Regional and UAE Hotel Market:

An HVS Outlook

Talal Yousif

Director

HVS Dubai

- 2 -

An overview and analysis of the performance of the Middle East andNorth African markets, based on actual historical data from acomprehensive sample:

• Over 680 branded hotels, representing approximately 170,000 rooms

• 42 major cities

• 13 countries

• 20 internationally and regionally recognized operators

HVS Annual Middle East Hotel Survey

- 3 -

Leading and Trailing MarketsMiddle East

- 4 -

70 68

41 4033

-19-22 -24

-35

-45-60

-40

-20

0

20

40

60

80

Marsa AlAlam

Taba Sharm ElSheikh

Alexandria Ras al-Khaimah

Luxor Dead Sea Taif Dammam Salalah

% C

han

ge

Source: HVS data

%

Leading and Trailing Markets - Middle East RevPAR % Change 2018

- 5 -

Source: HVS data

30

2421

17

9

2

-1-4 -5

-9

-14-20

-10

0

10

20

30

40

Jeddah Cairo Manama Dubai Riyadh Muscat KuwaitCity

AbuDhabi

Makkah Medina Doha

% C

han

ge

%

Leading and Trailing Markets - Major CitiesRevPAR % Change 2018

- 6 -

Source: HVS data

155

138131

121

109

34

25 22 2017

0

20

40

60

80

100

120

140

160

180

Jeddah Dubai Al Jubail Beirut Kuwait City Sharm ElSheikh

Hurghada Marsa AlAlam

Taba Luxor

Rev

PAR

(U

S$)

Leading and Trailing Markets - Middle EastRevPAR Performance 2018 (US$)

US$

- 7 -

Source: HVS data

155

138

109 108101 91

87

74 73

0

20

40

60

80

100

120

140

160

180

Jeddah Dubai Kuwait City Makkah Riyadh Manama Abu Dhabi Doha Muscat

US$

Leading and Trailing Markets – Major Cities RevPAR Performance 2018 (US$)

Occ+2% pts

ADR +26%

Occ-1% pts

ADR +20%

Occ-11% pts

ADR +20%

Occ-1% ptADR -2%

Occ+1% pt

ADR +8%

Occ+2% pts

ADR +16%

Occ0% pts

ADR -4%

Occ+3% pts

ADR -18%

Occ+6% pts

ADR -7%

- 8 -

The United Arab Emiratesin Focus

- 9 -

Source: HVS data

UAE Occupancy Performance (%) Historic (2008-2018) and Outlook

70%

55

60

65

70

75

80

85

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 5 yearforecast

(2018-2022)

10 yearforecast

(2018-2027)

Abu Dhabi Dubai Northern Emirates UAE 10-year Average

%

Occupancy % 10-year averageAbu Dhabi 71%Dubai 76%Northern Emirates 69%

UAE 10-year average Occupancy

70%

- 10 -

Source: HVS data

UAE ADR Performance (US$)Historic (2008-2018) and Outlook

US$ 137

0

50

100

150

200

250

300

350

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 5 yearforecast

(2018-2022)

10 yearforecast

(2018-2027)

Abu Dhabi Dubai Northern Emirates UAE 10-year Average

US$

ADR 10-year averageAbu Dhabi US$ 165Dubai US$ 201Northern Emirates US$ 114

UAE 10-year average ADR

US$ 137

- 11 -

Source: HVS data

UAE RevPAR Performance (US$)Historic (2008-2018) and Outlook

US$ 97

0

50

100

150

200

250

300

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 5 yearforecast

(2018-2022)

10 yearforecast

(2018-2027)

Abu Dhabi Dubai Northern Emirates UAE 10-year Average

US$

UAE 10-year average RevPAR

US$ 97RevPAR 10-year averageAbu Dhabi US$ 119Dubai US$ 153Northern Emirates US$ 78

- 12 -

UAE Outlook Occupancy Performance (%)

UAE Outlook Occupancy Performance (%)

Source: HVS Research

- 13 -

UAE Outlook ADR and RevPAR Performance (US$)

Source: HVS Research

Abu Dhabi RevPAR Dubai RevPAR Ras Al Khaimah RevPAR

- 14 -

Shifting Investment Considerations

Alignment of Expectations with Market Dynamics

1. Category Upscale (4-star/5-star) Midscale (3-star)

2. Hotel Model Traditional Lifestyle, Privacy (Airbnb)

3. Location Primary Secondary

4. Travel Conventional / Facilities Experiential / Activities

5. Business Model Hotel Management Hotel Franchise

6. Development Brick and Mortar Modular, 3D Printing

7. Technology Process-driven Disruptive Value Creation

8. Design Overspecification Flexibility and Efficiency

9. Operator Standardisation Customisation

10. Horizon Short-Term (Ego) Long-Term (Potential Value)

- 15 -

HVS Valuation Master Class Session

Hotel Valuation Index (HVI) Middle East 2019 First Issue

Available for download on AHIC website and www.hvs.com

Wednesday 10 April 14:30-15:15

- 16 -

Emirates Financial Towers, DIFC

2102 North Tower

P.O. Box 482 068

Dubai, United Arab Emirates

Tel: +971 4 354 4771

www.hvs.com

Superior Results Through Unrivaled Hospitality Intelligence. Everywhere

Talal Yousif

Director

HVS Dubai