Over 13 million tourists visited Dubai in 2014, representing a year-on-year rise of 8.2 percent, a 4.7 percent rise over the global average and ongoing investment in leisure and tourism
Dubai tourism is surging ahead with the country’s fast-evolving economy, lowered dependence on oil reserves to secure development and heightened growth through the 2020 World Expo. Winning the bid put the emirate on the global tourism map, led to the rise in the number of visitors and in turn fuelled the Short term rental market and created a massive expansion in Dubai’s hotel capacity.
However, the biggest impact that Dubai Tourism has had so far on the Dubai real estate market has been the announcement, launch and completion of several residential, commercial, entertainment and infrastructure projects in the emirate, in anticipation of the World Expo. With 25 million visitors expected to attend the mega event, the knock-on effect on the Dubai real estate market has been significant. To give you an example, there are currently three theme parks under construction, namely, Motiongate a Hollywood-inspired attraction, Legoland Dubai and Bollywood Parks. Once open, the parks are expected to attract over 6.7 million ticketed visitors.
Additionally, given the growing importance of the Short term rental market, Dubai Tourism industry has made great progress in setting up regulations for holiday homes, which will benefit the Dubai real estate market by providing a revenue stream for owners wishing to rent out their properties on a short-term basis.
The Expo is also expected to have a huge impact on commercial and office space with global corporates looking to establish and expand their services in Dubai. Additionally, it is expected to add two percent to Dubai’s Gross Domestic Product and create 277,000 jobs. However, the Expo’s highest impact is expected to be seen not just in the run up to the event, but in taking advantage of the immediate benefits to create positive long-term effects on the Dubai Tourism and Dubai real estate market.
To sum up, growing Dubai tourism will translate into growing demand for Dubai real estate, better infrastructure and create a need for more hotels, offices and short term rental. The process of harmonisation between the Dubai real estate market and Dubai Tourism industry to meet the increasing tourism demands in preparation for Expo 2020, is growing. So, while Dubai’s mega projects will increase the strength of Dubai Tourism, Dubai Tourism will in turn spurn investments in the Dubai real estate market.