Ski slope remains big draw at Kempinski MoE (page 1 of 2)

When the Kempinski Mall of the Emirates (MoE) opened in 2006, its adjacent mall was the largest outside North America, and Ski Dubai was one of the emirate's most well-known attractions. Today both the mall and its indoor ski slope remain big draws, but the hotel faces new challenges as the number of retail and hospitality establishments have risen sharply in recent years.

'The mall is important for us and we are important for the mall,' Holger Schroth, the hotel's GM, told AMEInfo.com. 'We see ourselves as a combination. We try to attract high-profile clients and guests who have the ability to shop in high-profile stores. So there is a dependency between us. Both are beneficial for the other.'

So far, MoE has managed to see a rise in footfall despite the financial downturn and the opening in 2008 of Dubai Mall - the world's largest mall based on total area. 'MoE is a mall that is well positioned in the market. People know it and it has gained its due in the past few years,' he notes. 'There is space for both malls in Dubai.'

When it was launched the Kempinski MoE was unique because of its attachment to a mall, but the Dubai Mall now has its own hotel too. It must mean that our concept is successful,' Schroth says with a laugh.

Rate cut

Like most hotels in the world, the Kempinski MoE was hit by the downturn, but avoided lowering its rates as much as possible during the crisis. 'All hotels faced the challenge of attracting guests. One way was to lower your rates, but then the question was how much,' he notes.

'A hotel will not be viewed as very trustworthy if it was charging Dhs2,000 before, and now is charging Dhs500. Also, you need to have a certain rate to provide the service which goes with it, because the guest who came here paying Dhs2,000 is expecting the same service when he pays Dhs1,000 or Dhs500.'

The hotel ended up dropping its rates by an average of about17% over the past nine months, with occupancy levels seeing a lesser dip. 'Whatever was budgeted for 2009 is obsolete. In comparison to our budget, yes we are below are targets, but compared to the rest of the market we are doing ok,' he says.

Occupancy levels

The fact that the hotel is adjacent to a mall has helped its occupancy levels during the downturn as a large portion of its guests are GCC locals, who are big shoppers and have tended to travel closer to home during the crisis.

'The summer was a good period, as it usually is, because people came from countries that are maybe even hotter than Dubai to go to a mall hotel rather than a beach hotel where you wouldn't go out anyway,' he says.

Occupancy rates at the hotel for July and the first 15 days of August were 92%, up 4% from the same period a year ago.

Although September was a slow month as expected because of Ramadan, occupancy levels are expected to swing back up to 80% in November, 'which is still impressive', he says. 'Obviously the year before we might have been at 90%, so it is still a drop of 10 percentage points, but it helps us finish the year a little better.'

Eyes on China

The hotel plans to step up efforts to attract more guests from China as the government body that regulates the number of Chinese nationals leaving the country recently relaxed restrictions on tourist travel to the UAE. 'Kempinski has 19 hotels in China, so it is a well known brand in the country and we have a large sales force there that will help to sell Dubai,' he notes.