Emaar Hospitality Group, a wholly-owned subsidiary of Dubai-based global property developer Emaar Properties PJSC, is not considering listing its hotels business, the company’s new CEO said on Monday.
The developer raised $1.6 billion after it sold a 15.4 percent stake in its retail unit Emaar Malls Group in an initial public offer (IPO) in September 2015, according to a Reuters report. A listing for Emaar Hospitality was due to follow “as soon as possible”, the report added.
"An IPO is not on the table currently,” Olivier Harnisch, CEO of Emaar Hospitality Group, who joined the group on March 1, told reporters at a press conference during the Arabian Travel Market exhibition in Dubai.
“We’re focusing on our development, on increasing the value of the company, that's a clear objective, and to ensure that we provide fantastic experiences in all our hotels,” he said.
An Emaar spokesperson previously told Reuters that the timing of the IPO would be dependent on “market conditions”.
“We are watching the markets closely and will take a decision to list at the appropriate time,” an Emaar spokesperson said in an emailed statement in January 2015.
“Emaar's strategy is to make its business segments independent listed companies. This approach aims to provide the businesses with appropriate financial and operational means to grow faster and become among the most successful companies in their industries,” the statement added.
Harnisch said at the press conference that Emaar’s hospitality division had recorded positive growth year in 2016 and higher than industry average occupancy levels, despite market conditions and was a “key contributor” to Emaar Properties’ overall revenues.
“Last year we recorded a robust revenue of 1.68 billion UAE dirhams [$457.4 million], and that’s about 14 percent higher than 2015,” he said. “You all know how the Dubai market developed last year compared to 2015. You can see that our hotels have developed very differently, much stronger than the rest of the market.”
He said Emaar’s hotels enjoyed an average occupancy of above 85 percent.
Emaar Hospitality Group’s current portfolio of hotels in Dubai includes the Address Boulevard, Address Dubai Mall, Address Montgomerie, Address Dubai Marina, Palace Downtown, Vida Downtown, Manzil Downtown, Rove Downtown, Rove City Centre and Rove Healthcare City. The company has 20 projects currently under development, with six new projects in the pipeline.
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