Laurent A. Voivenel, CEO of HMH – Hospitality Management Holdings, was a key speaker among the distinguished panelists taking part in Arabian Travel Market 2015 Seminar on ‘Affordable Luxury, Mass Appeal’.
Moderated by Dominic Ellis, Editor, Business Travel Middle East, the panel also included SudhirSreedharan, Senior Vice President Commercial (GCC Subcontinent Africa), Flydubai and Paul Byrne, CEO, flynas among others.
Laurent spoke at length on the reasons behind the Middle East regioin’s key destinations need to broaden their appeal through ‘affordable luxury’ offerings.
He stressed, “Budget hotels have emerged as the greatest business opportunity across the Middle East and Africa owing to multiple reasons. There is a considerable shortage of affordable accommodation and not enough supply. And as the low cost airlines blossom, cost-conscious travellers are flooding the market pushing the demand for mid-market lodging.
Given the staggering demand we see massive potential for ECOS Hotels that is a ‘no frills’ B & B brand tying together a unique economical and ecological concept. It is a smart choice for investors offering strong investment opportunity because of lower construction and operating costs and quick and high return on investment.And we are eager to roll it out in strategic locations beginning with Dubai”.
Expanding Middle Class in key source markets of Asia and Africa is pushing demand for budget lodging. By 2030, globally the middle class will more than double in size, from 2 billion today to 4.9 billion.
Laurent commented, “If the region’s key destinations such as Dubai are to reach their target of 20 million annual visitors by 2020, they will need to diversify their accommodation options with development of more mid-market hotels to attract budget travellers. At HMH we wish to take advantage of this massive opportunity in the budget segment”.
According to Airports Council International, 70.5m international passengers passed through Dubai Airport in 2014, against Heathrow’s 68.1m. And majority of these travelled economy clearly indicating opportunity for affordable accommodation.
Laurent stated, “Low cost carriers have had a dramatic impact on tourism industry with Middle East LCCs recording the 3rd highest rise in seats globally. Apart from boosting overall numbers, budget airlines have also opened lesser-known destinations. We need to make sure we have got the right accommodation for these travellers. Long-term sustainability of the tourism industry, therefore, depends on development of budget sector catering to growing middle class in emerging economies of Asia, Africa, CIS, Eastern Europe and Latin America”.