Rapid hotel development across the Middle East is creating new opportunities for hospitality operators, but industry leaders say the next phase of growth will be defined less by room count and more by profitability, asset productivity and the ability to differentiate in increasingly competitive markets.
Image by Evan-Lee Courie
Speaking at the Does the Hospitality Industry Need Reinventing? panel at the recent 2026 Arabian Travel Market (ATM) in Dubai, executives from Radisson Hotel Group, Minor Hotels and Rotana Hotel Management Group argued that the region does not need to reinvent hospitality so much as accelerate its evolution.
The discussion, moderated by Thomas Shambler, head of Business at ITP Media, focused on changing ownership models, technology, AI, hotel economics and the growing pressure on operators to generate more value from existing assets.
For Tim Cordon, CEO of Radisson Hotel Group, the industry's challenge is not reinvention but speed.
“Reinvention implies to me that we've stood still,” Cordon said. “I think we have evolved a lot. What I would say is that the pace of evolution needs to accelerate.”
Hospitality remains a people business
Technology is changing how guests discover, book and interact with hotels, but the panel agreed that the fundamentals of hospitality remain largely unchanged.
Cordon pointed to the industry's slower adoption of technologies such as digital keys and AI-enabled search compared with sectors such as aviation.
Hotels now also need to consider how they appear when consumers use AI agents to research where to stay, rather than relying solely on conventional search engine optimisation.
However, Amir Golbarg, COO of Minor Hotels, said the industry's evolution has also brought it back to some of the principles on which hospitality was originally built.
He pointed to Minor's Anantara brand, which was founded around indigenous and sustainable luxury, destination experiences, history, heritage, culture and wellness.
As Minor developed its Anantara 2.0 proposition, the group found itself returning to these fundamentals, particularly the intangible elements of hospitality.
“Intangible emotions and experiences are still led by people,” Golbarg said.
For Eddy Tannous, COO of Rotana Hotel Management Group, the same principle has held through successive waves of technological change.
Guests may have moved from booking by phone to websites and now AI platforms, he said, but they still expect personalised service and human intervention when something goes wrong.
Growth is not the same as performance
The scale of hotel development in the Middle East has raised questions about whether continued supply growth could eventually become a problem.
The panel argued that the opportunity remains substantial, particularly as travel becomes an increasingly important part of consumer spending and infrastructure continues to expand.
Cordon said markets such as Dubai are more competitive than they were two decades ago, but that competition can drive operators to improve.
“There will ever be a time when Dubai has no space for another hotel, so long as it's the right hotel,” he said.
The bigger question, according to Golbarg, is where that growth takes place.
He argued that sustainable tourism requires destinations to look beyond individual cities and spread demand across wider regions.
The UAE's developing tourism proposition, including destinations such as Sharjah, Fujairah and Dubai South, could help extend visitor stays and distribute tourism more widely.
For hotel owners, however, more visitors and more rooms do not automatically translate into better returns.
Occupancy is only part of the equation
The panel challenged the industry's traditional focus on occupancy, average daily rate and RevPAR as measures of hotel performance.
Tannous said the more important question is how operators can maximise the revenue-generating potential of an asset at every point in the year.
That means matching the right product to the right customer at the right time and price rather than simply filling rooms.
Cordon went further, arguing that a hotel could achieve 100% occupancy and still deliver a poor business outcome if guests generate little additional revenue.
“If you could have a full hotel where guests only sleep in the business and your restaurants are empty, you've got 100% occupancy,” he said. “Is that a good piece of business? I'd argue not.”
Operators are therefore increasingly looking at metrics such as GOPPAR, TRevPAR and revenue generated per square metre, alongside traditional room-performance measures.
The objective is to maximise the productivity of the entire asset rather than simply the number of occupied rooms.
Golbarg added that owners should avoid cutting costs at the expense of revenue growth.
“Managing costs is the easiest thing in the business,” he said, arguing that cost control should not come at the expense of building the top line.
Finding new revenue in existing space
The search for additional revenue is also changing how hotel operators view their physical assets.
Cordon cited the example of a hotel that converted a small area into two paddle courts, creating a new revenue stream from previously underutilised space.
Tannous described another example from Rotana, where a Dubai hotel converted underused space into 20 indoor swimming-pool suites.
