Dubai hotel inventory hits 159,000 rooms, reports Cavendish Maxwell

Dubai’s hotel inventory surpassed 158,000 rooms in 2025, with nearly 70% of properties now classed in the luxury tier, according to Cavendish Maxwell’s Dubai Hospitality Sector 2025 Market Performance report.

Between January and December 2025, Dubai added 3,400 rooms across 10 new hotels, including Jumeirah’s Marsa Al Arab and the city’s second Mandarin Oriental, marking annual growth of 2.2% and a 1.3% rise on 2024. The emirate’s total inventory now stands at 158,700 rooms across 770 properties, reinforcing its position as one of the world’s most dynamic hospitality markets.

Cavendish Maxwell’s report highlights the continued dominance of premium accommodation in Dubai. Hotels in the Upscale, Upper Upscale and Luxury categories account for almost seven in 10 properties, while only around 30% of the market serves the mid-range and more affordable segments.

Before the Iran war, a further 4,600 rooms were due to come online in 2026, including 61 rooms expected at the UAE’s first Six Senses resort, with almost 90% of new openings positioned in the upper-tier segments. The pipeline showed sustained investor confidence in Dubai’s high-end hospitality offering, but brands may be adjusting their strategy as we continue into week three of the conflict.

Performance across the market remained robust in 2025, with average occupancy reaching 81%, an annual increase of 3.8%. Upscale hotels posted the strongest gains at 4.9%, followed by the luxury segment at 4.5%. The upper midscale category achieved the highest overall occupancy at 84.4%.

Average Daily Rates (ADR) rose 8.7% year-on-year to AED746, driven largely by the upper midscale segment, which recorded a 10.4% increase.

Commenting on the findings, Vidhi Shah MRICS, Director and Head of Commercial Valuation at Cavendish Maxwell, said: “The city’s diverse offerings – an expanded events calendar, a growing portfolio of hotels and resorts, adventure experiences, globally-renowned shopping festivals and world-class dining scene – have driven a shift in travel behaviour, with tourists moving beyond traditional sightseeing towards high-impact, experiential travel.”

Dubai welcomed 19.6 million visitors in 2025, sustaining strong momentum across diverse source markets. Western Europe continued to lead arrivals, contributing 21% of total visitors, followed by the GCC at 15.3%. Travellers from the CIS and Eastern Europe accounted for 14.8%, closely followed by South Asia with 14.7% and MENA with 11.1%. Additional growth came from North and Southeast Asia (9.5%), the Americas (7.1%), Africa (4.6%) and Australasia (2%).

Across the wider UAE, hospitality performance also remained resilient. Abu Dhabi led with city hotel occupancy at 82.8% and 78.6% at resorts, supported by a notable 21.3% rise in ADR across both categories. In Ras Al Khaimah, occupancy climbed 4.6% to 75%, with ADR up 6.6% to AED618. Fujairah maintained around 75% occupancy, while ADR grew 12.8% to AED433.

While the global tourism outlook faces short-term uncertainty due to geopolitical pressures, Cavendish Maxwell notes that Dubai’s underlying fundamentals remain firm.

Supported by strong infrastructure, diversified offerings and a “proven ability to recover from crises”, the emirate continues to rank among the world’s most resilient and competitive destinations.

This article was originally published in Connecting Travel.