Dubai’s Atlantis is looking to build as many as four additional hotels across the world, hoping to cash in on a leisure travel boom that’s so far proved resistant to concerns over inflation and a darkening economic outlook.
“We’re very interested in growth and looking at a lot of different markets and opportunities,” Timothy Kelly, Managing Director of Atlantis Dubai said in a recent interview. “We’re hoping this year to earmark a couple of deals,” he said, adding that the company is looking at Southeast Asia, the Middle East and North America.
The comments come amid a sustained rebound in leisure travel that’s boosted prices for everything from plane tickets to hotels and rental cars. Results from Booking Holdings Inc. and Expedia Group Inc. to Royal Caribbean Cruises and TUI AG point to consumers’ willingness to continue spending on services and experiences even if they’re paring back on physical goods.
Atlantis Hotels, owned by Dubai’s sovereign wealth fund, operates two large properties in the emirate and one in Hainan, China. Its hotels include the recently opened $1.5 billion Atlantis The Royal, where the top suite can go for $100,000 a night.
Demand for rooms in that hotel — the first under the ultra-luxury brand, Atlantis The Royal — is strong. With about 80% of the rooms open to guests, Kelly said the new hotel’s occupancy rate has been “near 80%” while the average daily rate is $1,200, he added.
“There’s also great interest, which we never really imagined in Atlantis The Royal,” he said. “And so we’re actually fielding calls from investors that really are more interested in the Atlantis The Royal brand than Atlantis The Palm brand.”
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Kelly said Atlantis typically invests in cities along with partners to reduce the risk for projects that can cost about $2 billion to build and as long as five years to construct and establish. Florida sits at the top of the list of cities where the hotel chain would like to build a coastal property.
“We don’t want to go out and finance billions of dollars and build,” Kelly said. Still, “we definitely want to have a portion of the ownership because we want to have a say, and we want to be engaged in its success, and we want to manage it.”
Gambling
Kelly, a Las Vegas native, spent 25 years in the management of integrated resort operations, including at Wynn Resorts Ltd., which last month unveiled details of a planned $3.9 billion gaming resort in the country — without explicitly saying that it would involve gambling.
Senior government officials say there are no imminent plans to allow gambling, but casino operators, consultants and lawyers familiar with the matter say there have been early discussions and a change is being considered, Bloomberg reported last week.
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Kelly said he hasn’t had conversations with stakeholders about the potential introduction of gambling in Dubai. Should the practice be legalized, managing the monetary and regulatory issues that come with a casino industry would be the most important step, he said.
Atlantis would open casinos if instructed by the government, Kelly said, but the focus was more on developing Dubai as a tourist destination with nearly as many hotel rooms as Las Vegas and a budding food scene with Michelin-starred restaurants.
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Casinos can be established “quite quickly,” Kelly said, when asked how tough it would be to get the infrastructure in place should the government allow gambling.
“In the US, it used to be in one place: Las Vegas,” he said. “Then it came to Atlantic City. Now it’s in 48 to 50 states — there’s variations of it. So it’s been able to expand and grow rapidly.”
