Opening a hotel in financial crisis: Atlantis Palm Hotel

Opening a hotel in financial crisis, you would think it isn't the best thing to do. Companies have difficulties, so have financial institutions and tourists react on this evolution by not spending that much money anymore. Though, the Arab Gulf State of Dubai thinks differently.

$ 1,5 mio. That's the price of this construction. Sol Kerzner, gaming and resort magnate, says they believe in this hotel, on a long-term vision. They believe Dubai will be one of the top destinations of the world. They have attracted a growing number of tourists. Is this surprising? No! Dubai and the rest of the gulf states are having a tourist boom. This because of the investments they do, and the becoming of a brand, the Gulf state-brand.

Back to the Atlantis Palm Hotel. The hotel's signature suite costs $ 25.000 a night, beyond the reach of ordinary holiday makers. But will this affect the rich businessman? They always spend a lot of money, when they are travelling, sometimes with money of the company itself and probably they will be doing throughout the crisis. Unless they really are affected by the financial problems, stocks...

But how many guests have been staying in the hotel since it has opened in September? The occupancy is around 77 and 78 percent according to Kerzner, but internal documents obtained by Reuters forecast occupancy, rates around 19 to 80 percent, between 19 - 25 November, and peaking when the star guests arrive for the Gala Lunch. But look at this: 17 November: Average Room Rate: $ 231. 20 November: Average Room Rate: $ 40!!! This because of a low occupancy. By now, it has raised from 26% up to 33%. Apparently, businesspeople do feel the financial crisis. And the hotel does too. It has this strange effect on us, hasn't it?

This hotel is a piece of art in Dubai, again. After the Burj Al Arab, it will be a magnificent hotel, that attracts wealthy tourists. And after all, that's the target of this Golf State...