Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
Abu Dhabi’s hospitality sector has recorded the strongest growth in the UAE during the first eight months of 2025, with revenue per available room (RevPAR) rising 24% year-on-year (YoY) and average daily rates (ADR) up 20.2% YoY, according to Knight Frank’s UAE Hospitality Market Review – Autumn 2025.
The report said that regional and international investors are increasingly drawn to the UAE’s hospitality market, which continues to mature with strong fundamentals and a growing pool of institutional capital.
Across the UAE, the sector delivered another solid performance, with both RevPAR and ADR rising 11.9% YoY to August, and average occupancy climbing 4% to 78.5%.
Dubai, the country’s largest hospitality market, recorded 10.1% RevPAR growth, supported by an average occupancy rate of 79.1%, while Ras Al Khaimah followed closely with 10% growth.
Reflecting the UAE’s reputation as a global luxury destination, the country’s 213,928 hotel rooms are heavily weighted towards high-end categories — 26% luxury, 22% upscale, and 21% upper upscale.
Total supply is expected to rise to 217,853 rooms by the end of 2025, a 3% increase from last year, before expanding to 235,674 rooms across 1,184 hotels by 2030.
Dubai continues to dominate the UAE’s hospitality landscape with 165,339 existing and upcoming keys, supported by its D33 Economic Agenda and 2040 Urban Masterplan.
It is followed by Abu Dhabi with 37,016 keys, Sharjah with 14,478, and Ras Al Khaimah with 11,902. More than 55.9% of the UAE’s upcoming hotel room supply is concentrated in Dubai.
Faisal Durrani, Partner and Head of Research, MENA at Knight Frank, said the UAE’s hospitality market “is going from strength to strength, with record tourist arrivals into cities like Dubai being a testament to the emirate’s meteoric rise as one of the world’s most visited cities.”
He added that the hotel transaction market in the UAE is now entering “a new phase of maturity,” with investor focus shifting from development to strategic acquisitions and asset repositioning.
Oussama El Kadiri, Partner – Head of Hospitality, Tourism & Leisure Advisory, MENA, said Abu Dhabi and Ras Al Khaimah are emerging as complementary investment destinations, offering leisure-driven opportunities and alternative asset classes. “As the UAE transitions from a development-heavy cycle to a more balanced, investment-led phase, hotel transactions are expected to remain active,” he said.
According to Knight Frank, the UAE’s maturing market, depth, and resilience are positioning the country as a leading destination for hospitality capital in the region, supported by sustained growth, rising international arrivals, and a strong pipeline of luxury developments.
