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Dubai ruler streamlines hotel investment

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In his capacity as the Ruler of Dubai, UAE Vice President and Prime Minister, His Highness Sheikh Mohammed bin Rashid Al Maktoum has issued a series of directives designed to enhance and streamline hotel investment and development in the Emirate.

The directives were made in response to recommendations raised by Dubai’s private sector developers during a consultation workshop organised and hosted by Dubai’s Department of Tourism and Commerce Marketing (DTCM) and Dubai Municipality and attended by representatives of key investors in the hospitality sector including Al Habtoor Group, Al Futtaim Group, Al Ghurair Group, Rotana Group, Dubai Holding and Emaar.

The workshop, held at The Address, Dubai Mall on January 16th, was designed to discuss the Tourism Vision for 2020, including the recent positive growth in the hospitality sector in terms of visitor numbers and hotel openings; to identify barriers-to-entry currently being faced by hotel investors; and to find solutions to further stimulate the sector, particularly in the three and four star segment, as the Emirate prepares to welcome 20 million annual visitors by 2020.

The directives made by His Highness Sheikh Mohammed bin Rashid Al Maktoum include:

-Hotel construction preapproval process period to be reduced to two months – currently the approval process for private developers ranges from three to six months;

-A one-stop-shop for all sector approvals to be created- a single streamlined system will be managed by Dubai Municipality to help reduce red tape for businesses and ensure the new reduced approval timeframes are met;

-Approval processes of planning permission for all hotel establishments in the Emirate to be standardised through Dubai Municipality – currently some free zones manage their own building regulations approvals processes for hotels in areas across Dubai: these will now be moved to Dubai Municipality; and

-Government land to be allocated for the development of three-star and four star hotels – Dubai Municipality and government-linked master developers will work with DTCM to identify key locations for hotels at favourable investment terms.

Additional incentives to help ensure the development of the additional three and four star hotels that Dubai will need by 2020 to meet the growth in visitor numbers include: no fees on change-of-use of land for hotel usage, and the establishment of a special committee to review the re-zoning of plots; and an additional year of exemption of the 10 per cent Dubai Municipality fee for any three and four star hotels which begin operating before June 2017, based on the Hotel Incentive initiative announced by DTCM in September 2013.

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“Dubai Municipality is fully committed to working with our Government partners and with hotel Investors and investors to ensure that we deliver on His Highness Sheikh Mohammed bin Rashid Al Maktoum’s directives and on His long term strategic vision,” said His Excellency, HE Hussain Lootah of Dubai Municipality.

“In partnership with public and private sectors, we will identify opportunities for streamlining in the hotel development sector, and work together to address them.

“Our aim is to continue Dubai’s journey; to further progress from our position as the region’s leading tourism and business destination to being recognised as a global leader in trade and tourism.

“To achieve this, we will demand and help our partners to deliver world-class buildings standards and to create an environment of high quality, sustainable growth,” he said.

His Excellency Helal Saeed Almarri, Director General of DTCM, added: “The directives by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, once again demonstrate his vision and his unwavering commitment to identifying and addressing any and all challenges to growth, to ensure Dubai’s continued success and prosperity.

“Collaboration and consultation between the public and private sector is essential if we are to ensure delivery of the infrastructure, accommodation, events and attractions needed to meet not only the current growth of the tourism sector but the ambitious plan we have for future growth.

“H.H. Sheikh Mohammed’s directives offer new and exciting opportunities for hotel investors. They will act as a stimulus to the sector and help to broaden our current accommodation offering, particularly within the three and four star segment, which is needed to meet the targets outlined in the Dubai Tourism Vision for 2020.”

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