Hotel operators in the United Arab Emirates expect weak occupancy results in the fourth quarter of 2026 and do not anticipate a full recovery of travel volumes from key markets such as Europe and the United States before the second quarter of 2027. Victor Abou-Ghanem, CEO of Story Hospitality, which manages the H Hotel Dubai and Al Maya Island & Resort in Abu Dhabi, said a recovery in the final quarter of this year is too early to expect.
“We expect a full recovery of travel volumes from Europe and the U.S. in the second quarter of 2027,” Abou-Ghanem said.
Market-Specific Recovery Timelines
Phillipa Harrison, CEO of the Ras Al Khaimah Tourism Development Authority, confirmed that international demand will remain subdued through 2026 and highlighted varying recovery timelines depending on source markets. She noted that while some neighboring markets around the UAE are forecasted to stabilize by the first quarter of 2027, others, including Germany, may not return to previous levels until the fourth quarter of 2027.
“Some neighboring markets will be back by Q1,” Harrison said. “Other markets like Germany might not be back until Q4 next year. That last 10 to 15% takes a little while to come back. And advisories
don’t help either.”
Saurabh Tiwari, vice president of Indian Hotels Company Limited (IHCL), added that business levels in the UAE hotel sector are not expected to return to those seen in 2024 and 2025 until late 2027.
Occupancy Recovery Outpaces Rates Amid Travel Advisories
Industry officials attribute the slow recovery primarily to a disparity between hotel occupancy rates and room pricing, with occupancy advancing faster than price levels. This gap is extending the overall timeline for full financial recovery in the sector. Additionally, ongoing travel advisories are dampening demand from certain international markets, further delaying progress.
These factors have created a staggered recovery pattern across the UAE’s
key hospitality hubs, including Dubai, Abu Dhabi, and Ras Al Khaimah, reflecting uneven return of travelers from major source countries in Europe and the United States.
