Dubai Welcomes More Alcohol-Free Hotels

The development of dry hotels (hotels that do not serve alcohol) in Dubai has continued to flourish, underpinned by the city’s strategic efforts to become the global capital of the Islamic economy. This initiative, supported by robust Islamic financing options, has seen significant progress since its early days in the 2000s.

“Sharia-compliant funds are increasingly influencing the hospitality sector,” observed Rupprecht Queitsch, chief executive and senior partner at INHOCO Group, a prominent hospitality consultancy based in Dubai.

The growth in Islamic finance is notable, with Islamic banking assets in the UAE reaching new heights each year. This financial backbone has facilitated the rise of hotels that align with Islamic principles, attracting both regional investors and international tourists seeking accommodation that adheres to their cultural and religious preferences.

As of 2024, the number of dry hotels and hotel apartments in Dubai has expanded significantly. Industry estimates now put the number well over 150, with properties ranging from economy to luxury segments. Newly established hotels such as the Zabeel House MINI by Jumeirah in Al Seef continue to highlight the modern amenities and architectural elegance that can coexist with Sharia-compliant services.

Guy Wilkinson, managing partner at Viability Management Consultants, notes that hotel apartments throughout the Gulf, including the UAE, predominantly operate under dry conditions, except when affiliated with licensed establishments. These properties focus primarily on generating revenue from room bookings over food and beverage sales.

Laurent Voivenel, CEO of Hospitality Management Holdings (HMH), elaborates on the economic model of dry hotels, “Our strategy to offset the absence of alcohol revenue involves enhancing our food and beverage offerings and significantly expanding our meeting and banquet facilities.” HMH oversees several properties, including the Coral hotels and EWA Dubai Deira Hotel, which have consistently achieved high occupancy rates. From January to August 2024, occupancy stood at an impressive 85%.

The clientele of dry hotels in Dubai predominantly includes visitors from the Gulf region, especially Saudi Arabia, who prefer accommodations that respect their lifestyle and religious norms. However, these hotels are increasingly popular with international tourists from Europe and beyond, who value the family-friendly and safe environment.

“These hotels cater to a diverse audience that values the combination of family-oriented services and high-quality facilities,” Wilkinson added.

Voivenel also pointed out the popularity of these hotels among single women travelers, who favor the secure and sober atmosphere.

Looking ahead, the prospects for dry hotels in Dubai appear robust. “As long as the support for Islamic finance continues and there’s market demand, we see no slowdown in the expansion of dry hotels,” Queitsch projected.

This ongoing development not only enhances Dubai’s hospitality offerings but also solidifies its position as a leader in the Islamic economic world, adeptly merging traditional cultural values with cutting-edge tourism infrastructure.