Dubai luxury hotels woo staycationers as tourists flee

On the Palm, an artificial island that has become synonymous with Dubai opulence, five-star hotels are busy on weekends and holidays once more, despite having been deserted by tourists.

The clientele is driven by hotels offering residents-only deals that have become a lifeline for Dubai's luxury tourism.

"I had never been in a hotel on the Palm because the prices were crazy," said Fadi Iskandarani, a doctor in his sixties who just spent his first weekend at a luxury resort on the tree-shaped island.

The Lebanese national, who has lived in Dubai for five years, decided to opt for a staycation after he saw that a hotel on the Palm had slashed its rates by a factor of four.

The hotel was not packed, with some floors closed because there were not enough guests.

But the pool-side area was filled with people, he said, who came to the Palm to enjoy a slice of luxury that had long been unattainable.

"Luxury in Dubai has become affordable for residents, before it was just for the rich, very rich people," he said.

- A lifeline -

With 19.5 million yearly tourists, Dubai is among the region's top destinations and was long seen as a playground for the world's rich and famous.

Its 827 hotels — including 173 five-star establishments — boasted an average occupancy rate of more than 80 percent.

But the war, which was triggered by US-Israeli strikes on Iran on February 28, shattered the Gulf's image as a haven of stability, with Tehran directing its fury at the oil-rich region.

The United Arab Emirates bore the brunt of Iran's missiles and drones, which hit hotels, including on the Palm, as well as its landmark Burj Al Arab resort.

Since a shaky ceasefire came into effect on April 8 some tourists have trickled in, but hotels are mostly relying on local guests, said Michael Robinson, the general manager of the Anantara The Palm Dubai Resort.

With its overwater villas, artificial lagoons and Thai-inspired decor, the luxury hotel is packed with Dubai residents, who get special discounts of up to 50 percent.

On Fridays and Saturdays, hotel occupancy sits between 70 and 90 percent, he said.

Sunday through to Thursday, it has an average occupancy of around 20 to 30 percent.

This new clientele has offered hotels a lifeline, allowing Anantara The Palm to remain "cash positive" without resorting to layoffs.