Why Dubai’s 5-star hotels are so good the hospitality industry needs a new rating system

Hotels in Dubai and Saudi Arabia are so good they deserve more than a five-star rating and are superior to properties in the US and Europe, according to new research.  

Hotel ratings across the globe are at risk of becoming outdated and no longer fit for purpose, according to Dubai-based real estate advisory group Cavendish Maxwell.

The company is calling for hospitality industry stakeholders to come together to explore a new approach to rating methodology and deliver a clear, trusted system that allows travellers to make more informed decisions when booking accommodation.

Dubai hotel ratings

In the Gulf, standards for ratings are now becoming so out of kilter with those in Europe and the USA that international comparisons are becoming impossible, according to the Cavendish Maxwell  “Is the system of hotel rating still fit for purpose?” report.

Meanwhile, Saudi Arabia’s unprecedented investment in tourism will further highlight the lack of appropriate, comparable international rating systems as the country opens new establishments that are a generation ahead of traditional five-star hotels elsewhere in the world, the report says.

Gergely Balint, Associate Partner, Commercial Valuation at Cavendish Maxwell, said: “A five-star hotel in Dubai and other parts of the Middle East is not equivalent to a hotel with the same rating in other global regions, particularly when it comes to brand new properties.

“The same can apply to four and three-star establishments, which offer varying levels of service and amenities depending on their location.

“Dubai’s Burj Al Arab was unofficially labelled the world’s first seven-star hotel when it opened 30 years ago: perhaps an early indication of the need to overhaul existing rating systems.

“There is no doubt that luxury hotels in the Gulf would benefit from a shift towards 6- and 7-stars.

“With tourism evolving at pace, gone are the days when the main reason for booking a hotel was for a break in the sun or a business conference.

“The steady rise in tourism subsectors such as wellness, adventure, experiential, sports and volunteering is not only diversifying hospitality offerings, but changing the expectations of travellers, too.

“As a result, the current hotel star rating system is, arguably, no longer appropriate at a global level.”

Hotel ratings were originally introduced to help guests understand the quality and facilities at their chosen destination, and later became important valuation tools for hotel brands and properties.

Ratings differ across the globe: Europe uses stars while the USA has diamonds. With tourism becoming more globalised, international rating systems, such as Booking.com’s stars and the Michelin Guide’s keys, have emerged, but even these assess different criteria within their rating methodology.

TripAdvisor’s bubble system assesses the overall guest experience, while Forbes Travel Guide looks at quality of facilities and level of service. The Green Star system only considers sustainability, while the Crescent Rating initiative applies only to Halal-friendly hotels, which are given between one and seven crescents.

Balintsaid: “Clearly, it is time for hospitality industry stakeholders to explore a new approach to hotel ratings. As a temporary first step, independent organisations’ publishing of ‘equivalent’ ratings between jurisdictions, rather like ‘exchange rates’, would be a welcome move.

“Longer term, existing international rating systems could gradually replace national ratings, bringing in a uniform set of criteria that all stakeholders would trust and understand.

“Changes will take time – and require challenging decisions that will mean winners and losers. Existing ratings systems may not survive if they don’t adapt promptly, while others may emerge to take their place.”

Research from Cavendish Maxwell shows that Dubai currently has around 720 hotels with nearly 150,000 rooms between them.

In H1 this year, 2,700 new rooms came to the market, and another 10,000 are set to be delivered by the end of 2025.

Hotels in the four-star category have seen the biggest growth in 2024, and there has also been a surge in new five-star rooms, with more than 1,680 opening between January and June.

This article is originally published in Arabian Business.